The nature of major taxi regulatory changes implemented in Seattle and San Diego during 1979 and the preliminary results of such changes are discussed. The changes substantially reduced fare and entry controls while retaining safety and insurance requirements. These changes are significant because taxis in most US cities have operated under conditions of regulated fare and entry for 40 years or more. The reasons why major regulatory revision took place in these cities are complex and difficult to attribute to any single cause. Some prominent reasons were the" pro· gressive" nature of the San Diego and Seattle City Councils and the desire to avoid frequent hearings on fare increases and other time-consuming regulatory matters. The generally unfavorable image of taxis in both cities did not aid the industry's vehement opposition to these regulatory chanoes. The implomentetion process involved the taxi Industry, elected officiab, and licensing and regulating authorities. The condhions of the taxi industry in both cities immediately prior to regulatory revision are described, and the revision process is examined. Explanations are offered as to why regulatory revision occurred in these cities, and the short-term and possible long-term impacts of the revisions are explored. Although the results are tentative, they should be helpful to those evaluating the desirability of regulatory changes in other cities.

The purpose of this paper is to examine some major changes in taxi regulation that took effect in the cities of Seattle and San Diego during 1979. These changes are significant because they reverse a policy prevalent in American cities for the past 40 years--that of strict control over the authority to operate a taxicab and the fares that may be charged. These revisions did not reduce" noneconomic" regulation of taxicabsi regulations concerning insurance, driver fitness, and vehicle safety remained unchanged or were increased. Because of the possible confusion between economic and noneconomic regulation inherent in the term" deregulation", the