Too Much License? A Closer Look at Occupational Licensing and Economic Mobility

CSOR Gets a New Name!
March 23, 2018
CSOR Director Published by Harvard Business Review
April 30, 2018

Too Much License? A Closer Look at Occupational Licensing and Economic Mobility

Dr. Edward Timmons, Director of CSOR and John “JJ” Hazenstab, Graduate Assistant for CSOR recently published a new paper (co-authored with Brian Meehan of Berry College and Andrew Meehan of Central Michigan) and it is now available through the Archbridge Institute. The paper assesses and analyzes how occupational licensing may be restricting opportunities in the United States. The paper proceeds by:

  1. Providing state-by-state estimates of growth in low- and moderate-income occupations from 1992 to 2012. An update is also provided for 2017. State profiles (sorted both by state and occupation) are provided as an appendix.
  2. Estimating the effect that growth in occupational licensing has had on absolute economic mobility. Evaluating at mean levels of economic mobility, our empirical results suggest growth in state licensing is associated with a 1.7% to 6.7% reduction in absolute mobility at the county level.
  3. Estimating the effect that growth in occupational licensing has had on income inequality. Evaluating at mean levels of income inequality, growth in licensing is also associated with increases in county level Gini coefficients (and thus income inequality) ranging from 3.9% to 15.4%.

 

View the PDF of the report here.

 

Source: Too Much License? A Closer Look at Occupational Licensing and Economic Mobility