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Annual Review of Law and Social Science

Volume 14, 2018

The Politics of Professionalism: Reappraising Occupational Licensure and Competition Policy

Abstract

Elite economists and lawyers contend that occupational licensure raises consumer prices and unemployment. Billed as a bipartisan boost to market competition, this technocratic policy agenda rests on thin empirical foundations. Studies of the wage effects of licensing rarely couple this analysis of its putative costs with convincing analysis of the benefits of the professional or vocational education validated via licensure. While some licensing rules may be onerous and excessive, licensing rules are inadequate or underenforced in other labor markets. Furthermore, by limiting labor market entry, occupational licensing rules, like minimum wage and labor laws, can help stabilize working- and middle-class wages. Although current antitrust law provides an ideological framework for technocratic attacks on licensing, it is fundamentally unsuited for evaluation of labor markets. Contemporary antitrust law's arcane concept of efficiency reflects neither the legislative objectives animating the antitrust statutes nor popular understanding of what competition policy should do.

Keyword(s): antitrust, labor market, occupational licensing, professions, unions, wages
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2018-10-13
2024-04-26
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