The taxi regulation guideline released by the Beijing municipal authorities is a small step toward properly managing the controversial industry.

The core of the guideline is that the number of taxies will be increased to meet the increasing demand in the capital.

Moreover, it stipulates that taxi companies in the city will no longer have permanent licenses; instead, they will be subject to reappraisal every six years. It also said the profits of taxi companies will be controlled.

However, the guideline, even if it is well implemented, may find it difficult to break the current deadlock in the sector.

Taxi drivers have complained about the high fees they have to pay their companies - 3,000 yuan ($480) a month in Beijing - low pay and long working hours. Many of them opt not to work during the rush hours, when the serious congestion in Beijing makes driving unprofitable for them. The public, meanwhile, have complained about the increasing difficulty of hailing a cab when they most want it.

Beijing is not alone in facing such problems, and many other cities are also seeking ways to improve the lives of taxi drivers and passengers.

Seen from the latest guideline, Beijing has sought to use the "visible hand" of administrative power to strengthen the government's management of taxi companies and will increase the number of cabs to solve the shortage problem. But this may have unwanted consequences.