TAXI REGULATION AND INNOVATION : A STUDY OF COMPUTER-AIDED DISPATCH IN THE SINGAPORE TAXI INDUSTRY

Abstract

This dissertation, is an investigation of the influence that regulations have on the level of innovation in the taxicab industry. It examines the way regulations impact upon the market structure in determination of innovation. An analysis of the preconditions necessary for innovation inherent in a market structure was also conducted. Innovation as defined in this thesis, pertains specifically to computer-aided dispatching. The study focused on the computer-aided dispatch market of the Singapore taxi industry. The results of the surveys and interviews conducted with the three main providers of the taxi service served as a basis for the analysis. The findings lend support to the hypothesis that regulation stimulates innovation. In general entry regulations create a competitive oligopolistic market structure, which promotes innovation. In particular, largeness of firms and monopoly power were found to be the two main preconditions that stimulated innovation.