Real estate, by contrast, won’t yield nearly as much current income (after expenses). Even at today’s prices, buyers of rental property seem to be counting on future appreciation.

However, just because buyers “have good information regarding the earning potential of a cab,” I don’t see why they would not expect to see medallion prices increase along with inflation, and thus bid them up so the current yield is less than 5%. Perhaps there are other risks.

None of which contradicts the basic fact that fare increases will raise (and increased medallion tax would lower) the price of medallions, not the earnings of drivers.