Sunday, October 16, 2011

Why I got thrown out of a taxi in Istanbul

In a word: incentives. 

A colleague from Istanbul was showing us around his adopted neighbourhood of Bebek some distance from the hotel. We went as far as we could in the new metro system* and then looked for a taxi. It was late-ish on Friday night and the traffic was bad. The taxi driver refused to take us there despite being offered double whatever was on the counter. 

I had noticed in other taxis that if you are stuck in traffic not moving the counter does not move. Taxi drivers are paid only by the distance that they cover and cannot charge for time spent idling. This is different to in Washington where the clock charges an amount for idling time, presumably equal to some average distance covered in the same time. 

The incentives in Istanbul are therefore to take long and clear routes and to throw people out of their cars if they are going to a place where the traffic is too bad.

At least, I think this is the reason; it may also have been that the driver objected to having four economists in his car, which is also, I suppose, understandable.


*World Bank economists are in touch with The People.

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