Taxi hailing app services are created spontaneously by the market to solve everyday travel issues using “Internet Plus” thinking.The purpose of government regulation on taxi hailing app services is to maintain public interest and increase social welfare.4 years of government regulation in practice indicates that this objective has not been reached，even going so far as backfiring and producing unintended results，that is to say，regulation failure.Based on the standpoint of public management，this study analyzes the governments unsuccessful regulations from the perspective of new institutional economics transaction costs theory，and point out that the high transaction cost cancels out their social welfare benefits.Optimizing institutional arrangements，defining the extent of government regulations on taxi hailing app services，exerting the crucial roles of the market in resources allocation，are good countermeasures to lower transaction costs and prevent regulation failures.