A reader writes:
Schumpeter has obviously never been to Tehran if he's praising their taxi system. I visited the city in 2002, and unless major changes has occurred, it's still one of the world's most polluted capitals, with virtually no functioning public transport, and the most anarchistic traffic you'll ever experience – cars opening up new lanes whenever needed, sometimes in the lanes going the opposite direction – and the streets are constantly clogged by traffic. The dire economic conditions at the time (probably worse now) was well illustrated by the fact that two out of three of my (unlicensed) taxi drivers had university degrees. That makes no sense whatsoever.
Crossing the street in Tehran (like in Algiers, where I am now, with a similar situation of government fuel subsidies and underdeveloped public transport) is putting your life at risk. It's an urban nightmare, and the "free taxi" stuff is making it worse. Market economy is great, but this example is really a poor one.
Update from a reader:
I think the reader response [above] is pretty far off. The lack of public transit and traffic are not because Tehran's taxi system is too dependent on the free market, but because the government has failed to invest in public transportation that would reduce the traffic problems your reader discusses. The Schumpeter post contrasts London, which has a tightly regulated system with Tehran where there is no said regulation. London is a city with from what I have heard a very good public transit system, plus it has congestion pricing – reducing regulations on its cabbies would open more employment opportunities and provide more cabs at lower prices for consumers. Tehran is not congested because there are too many taxis. It is congested because of a lack of alternatives.
Update from another:
I’m Iranian on my dad’s side and we went to live in Tehran when I was 10 years old, leaving shortly before the Revolution. The traffic was just as harrowing back then! There were NO defined lanes. You just inched your car into whatever space you can find. One-way signs were merely suggestions; nobody obeyed them. It was not uncommon to have a camel or goat cross the street (on the side streets) and the honking of horns was constant.
Dad told me that when he learned to drive, his father put him on his lap and said, "Son, you see that white line? Line that up in the middle of your car." I think that about sums up the problem.
Update from yet another:
In a former life, I was training to be a historian. My nascent area of expertise was 19th and 20th century Iran. While a graduate student, I had a summer fellowship (funded in part by the US government in a pilot program that has since been abandoned) that took me to Iran. I spent the summer of 2000 there, much of it in Tehran.
Your reader who was in Tehran in 2002 accurately describes the chaos of automobile traffic in Tehran. But I must say that with certain caveats that I do think it is a system worthy of praise. You can get where you are going very inexpensively. In those days it was never more than "one Khomeini" (10,000 rials / 1,000 toman — then about USD 1.25; Khomeini was on the note) to get anywhere in town.
I met lots of ordinary Iranians by riding around in Tehrani cabs – first and foremost the cabbies themselves, but it was pretty typical for a cab to pick up and drop off passengers along the way. A highlight of my trip was the conversations that I had while in cabs in Tehran. I imagine that it helped that my Persian was pretty clean in those days. But it's hard to imagine not having in general very pleasant and interesting conversations even in broken English in Tehrani cabs.
The caveats are about safety. I never bothered with a seat belt because it was painfully obvious that in the event of any accident of any serious magnitude, the crappy Iranian-assembled, British-manufactured and ubiquitous Paykans would turn to dust, instantly (hopefully) killing all occupants. It was on occasion a hair raising experience being in those cars in that traffic. Some quasi-Zen practice – turning oneself over to the driver and fate – was requried to avoid developing ulcers whilst riding those cabs.
But I loved the cabs in Tehran. And I loved my time in Iran. Wish I could go back. Beautiful country and a beautiful people and culture.