Taxi prices and permits are government regulated so there's no free market competition per se. The density of urban areas and the fact that people generally don't own cars help quite a bit since taxis are considered (somewhat) part of the public transport system and hence often utilized by the public (which I suppose means that taxi drivers idle less and this drives down the cost?) The cars are generally cheap (but reasonably sturdy) Toyotas, often old models, so the price of the vehicle doesn't drive up the costs. (I recall some places use luxury brands?)

Interestingly quite a few taxi drivers drive a taxi not so much for the money (it always helps) but rather to ward off boredom post-retirement (flipping properties in HK used to be almost as profitable as flipping crypto). This might be "competition" of sorts but not sure. I think drivers generally make slightly higher than median income if they work long hours, but don't know how it compares with other places.

The service level is generally shit though, some drivers literally refuse to make money if they deem your request a bit out of the ordinary (eg. refusing to take you for a short ride even if the fare per distance is higher than that of a long distance ride).