Challenges to regulation posed by online car services trade offs between multiple objectives, conflicts of interest, regulatory approaches

The key to “Internet+” is to transform traditional enterprises through Internet information technology to improve efficiency and better match supply and demand. The Internet-based network rental car service can match the supply and demand of cabs more effectively and reduce transaction costs, which is an innovative form that is more beneficial to consumers. In the face of the emerging network rental model, the traditional cab industry is sitting on the sidelines in front of this development trend if it keeps seeking protection from the regulatory authorities. For regulators, ignoring the positive effects of Internet technology on the development of the industry can also be a negative force that hinders social progress and innovation.

The challenge to regulation posed by network-booked rental car services. The development of the network rental model has brought many new problems and challenges to regulation, such as the question of whether private cars can enter the network rental car service field and how to regulate it, and the coordination and benefit distribution between Internet rental cars and cabs. The one-sided suppression of Internet rental services is not conducive to industry innovation and social satisfaction, while the failure to effectively regulate leads to vicious competition in the industry, proliferation of social group incidents and lack of assurance of passenger safety, so innovation in the regulatory sector is bound to be on the urgent agenda.

The first challenge is the trade-off between multiple objectives. The government’s regulatory objectives should cover the balance of economic, social and environmental aspects. Economically, it should ensure the normal income of cab and online booking taxi service companies (service providers) and take into account the interests of cab and online booking taxi employees; socially, it should include the social interests of improving cab services, improving the image of cities and easing urban traffic pressure, and ensuring social harmony; environmentally In the case of environmental protection, it is necessary to realize a resource-friendly development method from the perspective of environmental protection. The government control department needs to carry out a complex balance of multiple objectives under the premise of ensuring the interests of customer travel.

The challenge of coordinating the conflicting interests of various players. Effective regulation of the cab industry must take into account the many stakeholders in the industry, and the primary starting point is the interests of consumers. In the traditional era, emphasis was placed on maximizing the interests of the company’s shareholders, while in the Internet era, the concept of insisting that maximizing the interests of customers is ensuring that the interests of shareholders are maximized has been universally accepted as a characteristic of the Internet era, so government regulatory objectives should always put consumer needs and satisfaction first. On this basis, how to balance the conflict of interests between traditional cab companies and Internet car rental companies is a more urgent task.

The challenge of regulatory approach. The traditional control perspective believes that as long as cab companies are scaled up and centralized, their service level and efficiency will continue to improve, but on the contrary, the protection of monopoly operation of cab companies has formed interest groups that exploit drivers for high returns, while the ability to meet customer demand is not improved, which is the result of inefficient control. At the same time, the original regulation relied more on the control of license issuance and operation right flow, which is no longer able to face the regulation under the mode of network reservation taxi, and the conflict between network reservation taxi service and traditional cab service warns the government control department to change the regulation of the industry.

The challenge of technical means of supervision. With the advent of the “Internet+” era and the emergence of the network rental model, various kinds of Internet car service providers, Internet taxi platforms (Tic-Tac, Fast, Uber, etc.) and private cars joining the operation are emerging like a blaze of fire. These Internet car rental services bring various problems, but like Taobao platform, the innovative power it brings is also huge, they will force the traditional cab business reform, which is conducive to the overall social effectiveness and efficiency, but the more complex the industry participants, the more difficult it is to regulate, in terms of technical means, need to be able to implement monitoring of each vehicle in operation and its service process, which in In terms of technical means, it is necessary to monitor every vehicle in operation and its service process, which also poses a great challenge to the regulatory authorities.

Innovation of government regulation. A single regulatory approach has made it difficult to meet the balance of comprehensive and multiple objectives. Of course the drawbacks of existing Internet car rental services do exist, the entry of Internet car rental services as a service innovator is conducive to the overall efficiency and social benefits of the cab industry, the key lies in how the government regulatory departments to guide, how to change the control methods become an important and urgent task of the control departments.

To meet the above challenges, the governmental control department needs to adopt a set of regulatory changes. Take a more proactive supervision is the way out of the problem, comprehensive control means should be a combination of market, administrative and technical control means. Administrative control means include: license issuance and withdrawal, company access, driver access, regional restrictions, slot control, etc. Market coordination tools include subsidies, price control, tax standards, etc. For example, internet-booked taxi services should be encouraged during peak periods and in remote areas. The integrated public service platform provides a powerful technical control tool to analyze the total number of cabs, the utilization rate at different times, etc. through big data application measurement models, and to monitor and control the whole process of each cab, which can not only improve the overall efficiency and effectiveness of cab operation in society, but also guarantee the safety of consumers. The use of comprehensive control tools can not only promote efficiency, but also coordinate the industry’s stakeholders and resolve conflicts and contradictions.

The fundamental change of control means is to use the “Internet +” era of the technical support given. The Internet-based mobile public service platform and the support provided by big data to match supply and demand can solve problems such as setting the total number of cabs, arranging capacity and capability, and determining supply at different times and in different regions. Corresponding control strategies and methods can also be established to coordinate supply and demand, while achieving the goal of balancing the interests of industry stakeholders’ needs. Promoting the symbiosis and coexistence of Internet car rental services and traditional cabs to prosper together is an opportunity to improve the overall efficiency and effectiveness of the industry, as well as to improve the level of government control.

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