So it is a rare and genuine pleasure to be able to write in enthusiastic support of a new piece of legislation from the recently elected Coalition Avenir Quebec (CAQ) government: the abolition of supply management (“gestion d’offre”) in the province’s taxi industry. After the government’s Bill 17 is passed there won’t be any limits on who can sell rides for money in Quebec or on where in the province they can operate. You’ll still need to get a license for providing such services but the number of licenses won’t be limited, the bar for getting one won’t be artificially high, and it won’t cost you upwards of $200,000, which until the last couple of years was the going rate for what will soon be the old-fashioned, supply-restricted licences. (In fact, the government’s economic analysis suggests $4.80 would be a suitable administrative charge.
Change often hurts established interests, thus leading to the “tyranny of the status quo” as these interests resist change. How do you get around that problem? Economists’ classic recommendation is: don’t restrict competition in the first place but if it’s too late for that, free up competition while compensating the losers from change. The Quebec government is following that advice to a tee. Much as I’m unaccustomed to saying so: Good for them!
Next up: Bills 18, 19 and 20 should take the same wrecking ball to supply management in dairy, poultry and maple syrup.
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