I have to disagree, in that Uber&#x2F;Lyft&#x27;s success cannot be attributed merely to the price differential from flouting regulations; they significantly increased utility by applying modern IT to ride services: mutual rating, seamless payment, finding the the nearest driver&#x2F;best route, remote monitoring of the route taken, quick complaint resolution, pairing people into carpools, and the reassurance of seeing where the car is. Those are things the cab companies could have done, but didn&#x27;t.  (At least, they could have <i>asked</i> regulators for the relevant exemptions on grounds that it would enable better service.)<p>Remember, they started as (what&#x27;s now called) UberBlack, which simply allowed licensed limo drivers to fill in dead spots between requests. And, they had to overcome the barrier of not being able to just flag down a passing taxi.<p>They also solved a major collective action problem: drivers privately benefited from screening destinations (and races); enforcement of the laws thereagainst were far too spotty, and victims themselves had to bear a disproportionate private cost to testify and make the system work.  So Uber&#x2F;Lyft put a &quot;veil of ignorance&quot; over destinations, ensuring that everyone got a random share of the bad routes. The reputation system also obviated much of the reason for for discrimination against &quot;scary looking&quot; people.<p>Furthermore, even flouting regulations should tolerated if the provider can accomplish the <i>goals</i> of the regulation (thereby revealing a more efficient way), and it looks like Uber&#x2F;Lyft have solved the traditional problems of e.g. discrimination, fighting over fares, clogging major pickup locations, drivers being targets of robbery, longhauling, declining credit cards, kidnapping passengers, reliable service and whatever else. If Uber&#x2F;Lyft were externalizing major costs that the regulations were preventing, it would have shown up by now.<p>(FWIW, I think they <i>are</i> externalizing a cost in terms of screwing over drivers and bystanders on insurance, but the incidence seems to be rare enough that if they were forced to cover this, it would not significantly impede their business model.)