the medallions are distributed in auction, to align with the great american myth that those who can pay the most deserve it the most.

Granted, alternatives would probably involve taxi companies wining and dining to get preferred treatment.

Once we've decided on having some sort of system to limit the number of taxis, there's going to be some form of selection. Apparently people thought auction was the "least worst" way (compared to some other selection method).

>Apparently people thought auction was the "least worst" way

Auctions only confirmed the intrinsic value of medallion in that system - $2K/month rent pay for a medallion in SF before the auctions corresponds to something like $200K value of a rent-generating asset.

>Once we've decided on having some sort of system to limit the number of taxis

exactly, protecting monopoly as such a limit has nothing to do with consumer safety.

Edit: just googled - the medallion price in NY is $1M and in SF - $300K. Sorry for using obsolete data (holy macrel what a nice exponentially looking price ride of recent 3 years Uber has killed : http://www.aei-ideas.org/2014/06/chart-of-the-day-nyc-taxi-m... )

>exactly, protecting monopoly as such a limit has nothing to do with consumer safety.

There's other reasons to want that. Congestion control is one of them. No comment on the validity of such a fear, though

I believe that's historically what caused the first introduction of such a system, in London some centuries ago: residents complained there were too many hackney carriages driving around the streets, and wanted them limited to a fixed number. (They also wanted them better maintained and more safely driven, which led to additional rules.)

But funny enough, there is no fixed number of cabs in London now.