In multiple European cities now I see taxis being allowed to use the bus lane (while of course regular cars are not).

What's the policy justification for this?

Because they are seen as public transport. Technically they are only supposed to do so when working. Personally I prefer to have them in the taxi lanes as they are among the least predictable drivers.

But taxis don't have any of the key properties of public transport that usually motivate actively subsidizing its adoption?

* environmental friendliness
* low contribution to congestion
* high-fixed-cost cost curve

"You're annoying so you get to use the fast lane" feels like good short-term move but bad long-term :D

I guess the thought is that taxis are circulatory transport so for people who have not introduced an additional personal car to the system.

I don't have all the information to know if it's a good idea or whether incentivising mass transit should be the goal.