To be fair, counties or cities can limit demand, but they're limiting demand to "these current 200 tiny companies because with 10 more, no one can make a living anymore", not to "that big juggernaut and nothing else". The law actually demands it (both limiting for economical reasons and spreading the load).

And the reason for why they interfere in such a way is that taxis are considered a mode of public transportation, which was declared at some point a county issue.

Thanks to that we also don't have that mess of three different types of uncoordinated local railway and bus systems that the bay area "enjoys".

(not Xylakant but in general:) Please don't assume your third world style problems also apply to everyone else. (like Uber and their fans do with that endless "taxi mafia" nonsense)