Occupational Licensing

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Morris M Kleiner - One of the best experts on this subject based on the ideXlab platform.

  • Occupational Licensing: Improving Access to Regulatory Information
    Journal of Labor Research, 2020
    Co-Authors: Morris M Kleiner, Edward J Timmons
    Abstract:

    Occupational Licensing affects more than one in five workers in the US, but research is often limited by the high cost of obtaining regulatory data. We highlight existing and forthcoming databases of regulatory information. We also summarize the papers included in this volume and discuss their contribution to the literature.

  • The Labor Market Consequences of Regulating Similar Occupations: the Licensing of Occupational and Physical Therapists
    Journal of Labor Research, 2020
    Co-Authors: Jing Cai, Morris M Kleiner
    Abstract:

    This study examines the influence of Occupational Licensing on two significant occupations that provide similar health care services: Occupational therapists and physical therapists. Since many of the tasks that these occupations overlap, individuals in both occupations can have legal jurisdiction over these tasks. We examine how these two occupations interact with one another in the labor market on wage determination and employment. Unlike previous analyses of Occupational Licensing, our study evaluates two professions that are female dominated both within the vocations, and among its leadership. Our results show that the ability of physical therapists to have direct access to patients is associated with a reduction in hourly earnings for Occupational therapists, suggesting there is substitution for certain overlapping service tasks across the two occupations. The ability of these two occupations to be mainly substitutes for one another provides new evidence on how the growing numbers of regulated occupations that provide similar tasks influence one another.

  • Occupational Licensing and labor market fluidity
    Staff Report, 2020
    Co-Authors: Morris M Kleiner
    Abstract:

    We show that Occupational Licensing has significant negative effects on labor market fluidity defined as cross-occupation mobility. Using a balanced panel of workers constructed from the CPS and SIPP data, we analyze the link between Occupational Licensing and labor market outcomes. We find that workers with a government-issued Occupational license experience churn rates significantly lower than those of non-licensed workers. Specifically, licensed workers are 24% less likely to switch occupations and 3% less likely to become unemployed in the following year. Moreover, Occupational Licensing represents barriers to entry for both non-employed workers and employed ones. The effect is more prominent for employed workers relative to those entering from non-employment, because the opportunity cost of acquiring a license is much higher for employed individuals. Lastly, we find that average wage growth is higher for licensed workers than non-licensed workers, whether they stay in the same occupation in the next year or switch occupations. We find significant heterogeneity in the Licensing effect across different occupation groups. These results hold across various data sources, time spans, and indicators of being licensed. Overall, Licensing could account for almost 8% of the total decline in monthly Occupational mobility over the past two decades

  • re examining advances in Occupational Licensing research issues and policy implications
    British Journal of Industrial Relations, 2019
    Co-Authors: Alex Bryson, Morris M Kleiner
    Abstract:

    Much has changed in the realms of Occupational Licensing since BJIR last ran a special issue on the subject in 2010. The number of occupations subject to Licensing has been growing, the data available to investigate the incidence and effects of Licensing have improved immeasurably, and the policy environment surrounding Licensing has changed. This issue reflects these changes with eight papers from North America and Europe covering the incidence of Licensing, and its effects on wages, inequality, employment, quality of service provision and rent extraction by the organizations who undertake Licensing.

  • a welfare analysis of Occupational Licensing in u s states
    2019
    Co-Authors: Morris M Kleiner, Evan J Soltas
    Abstract:

    We assess the welfare consequences of Occupational Licensing for workers and consumers. We estimate a model of labor market equilibrium in which Licensing restricts labor supply but also affects labor demand via worker quality and selection. On the margin of occupations licensed differently between U.S. states, we find that Licensing raises wages and hours but reduces employment. We estimate an average welfare loss of 12 percent of Occupational surplus. Workers and consumers respectively bear 70 and 30 percent of the incidence. Higher willingness to pay offsets 80 percent of higher prices for consumers, and higher wages compensate workers for 60 percent of the cost of mandated investment in occupation-specific human capital. Welfare effects appear more favorable in occupations in which Licensing is more common.

Bradley Larsen - One of the best experts on this subject based on the ideXlab platform.

  • consumer protection in an online world an analysis of Occupational Licensing
    Social Science Research Network, 2020
    Co-Authors: Bradley Larsen, Chiara Farronato, Andrey Fradkin, Erik Brynjolfsson
    Abstract:

    We study the effects of Occupational Licensing on consumer choices and market outcomes in a large online platform for residential home services. We exploit exogenous variation in the time at which licenses are displayed on the platform to identify the causal effects of Licensing information on consumer choices. We find that the platform-verified Licensing status of a professional is unimportant for consumer decisions relative to review ratings and prices. We confirm this result in an independent consumer survey. We also use variation in regulation stringency across states and occupations to measure the effects of Licensing on aggregate market outcomes on the platform. Our results show that more stringent Licensing regulations are associated with less competition and higher prices but not with any improvement in customer satisfaction as measured by review ratings or the propensity to use the platform again. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

  • consumer protection in an online world an analysis of Occupational Licensing
    National Bureau of Economic Research, 2020
    Co-Authors: Chiara Farronato, Bradley Larsen, Andrey Fradkin, Erik Brynjolfsson
    Abstract:

    We study the effects of Occupational Licensing on consumer choices and market outcomes in a large online platform for residential home services. We exploit exogenous variation in the time at which licenses are displayed on the platform to identify the causal effects of Licensing information on consumer choices. We find that the platform-verified Licensing status of a professional is unimportant for consumer decisions relative to review ratings and prices. We confirm this result in an independent consumer survey. We also use variation in regulation stringency across states and occupations to measure the effects of Licensing on aggregate market outcomes on the platform. Our results show that more stringent Licensing regulations are associated with less competition and higher prices but not with any improvement in customer satisfaction as measured by review ratings or the propensity to use the platform again.

  • Occupational Licensing and quality distributional and heterogeneous eects in the teaching profession
    Social Science Research Network, 2015
    Co-Authors: Bradley Larsen
    Abstract:

    This paper examines a common form of entry restriction: Occupational Licensing. The paper studies two questions: rst, how Occupational Licensing laws aect the distribution of quality, and second, how the eects of Licensing on quality vary across regions of diering income levels. The paper uses variation in state Licensing requirements for teachers and two national datasets on teacher qualications and student outcomes from 1983{2008. Two measures of quality are used: the qualications of candidates entering the occupation (input quality) and the quality of service provided (output quality). Results show that more restrictive Licensing laws|in the form of certication tests required for initial licensure|may lead some rst-year teachers of high input quality to opt out of the occupation. In the sample of teachers who remain in the occupation multiple years, stricter Licensing appears to increase input quality at most quantiles of the teacher quality distribution. Output quality, as measured by student test scores, also changes with stricter Occupational Licensing, revealing a widening of the distribution. For most forms of Licensing studied, input and output quality improvements due to stricter Licensing requirements occur in high-income rather than low-income school districts.

  • Occupational Licensing and quality distributional and heterogeneous effects in the teaching profession
    2013
    Co-Authors: Bradley Larsen
    Abstract:

    This paper examines a common form of entry restriction: Occupational Licensing. The paper studies two questions: first, how Occupational Licensing laws affect the distribution of quality, and second, how the effects of Licensing on quality vary across regions of differing income levels. The paper uses variation in state Licensing requirements for teachers and two national datasets on teacher qualifications and student outcomes from 1983-2008. Two measures of quality are used: the qualifications of candidates entering the occupation (input quality) and the quality of service provided (output quality). Results show that more restrictive Licensing laws may lead some first-year teachers of high input quality to opt out of the occupation. In the sample of teachers who remain in the occupation multiple years, stricter Licensing appears to increase input quality at most quantiles of the teacher quality distribution. The distribution of student test scores also increases with stricter Occupational Licensing, primarily in the upper half of the distribution. For most forms of Licensing studied, input and output quality improvements due to stricter Licensing requirements occur in high-income rather than low-income school districts, consistent with theoretical predictions of Shapiro (1986).

Austin C Smith - One of the best experts on this subject based on the ideXlab platform.

  • Occupational Licensing of social services and nursing home quality a regression discontinuity approach
    Industrial and Labor Relations Review, 2021
    Co-Authors: John R Bowblis, Austin C Smith
    Abstract:

    Occupational Licensing has grown dramatically in recent years, with more than 25% of the US workforce having a license as of 2008, up from 5% in 1950. Has Licensing improved quality or is it simply...

  • Occupational Licensing of social services and nursing home quality a regression discontinuity approach
    Social Science Research Network, 2018
    Co-Authors: John R Bowblis, Austin C Smith
    Abstract:

    Occupational Licensing has grown dramatically in recent years, with over 25% of the U.S. workforce having attained a license as of 2008, up from 5% in 1950. The associated debate as to whether Licensing improves quality or is simply rent-seeking behavior has correspondingly grown in intensity. Exploiting a staffing provision of the Omnibus Budget Reconciliation Act of 1987, we estimate the impact of increased licensure of social workers in skilled nursing facilities on quality. The key provision requires all skilled nursing facilities (SNFs) with 121 or more beds to provide at least one full-time equivalent qualified social worker. Using a regression discontinuity design, we find that this provision binds at that margin for a significant share of SNFs. Qualified social worker staffing increases by 8-10%. However, the overall increase in social services staffing is negligible because firms tend to meet this requirement in the lowest cost way – substituting from unlicensed, paraprofessional social services staff to qualified social workers, effectively increasing the licensure level of the marginal social services staff. We find no evidence that the upgrade in social services staffing improves overall SNF quality, quality of life, or provision of social services, as measured by the deficiency scores received by a facility during their annual recertification inspection.

David Leblang - One of the best experts on this subject based on the ideXlab platform.

  • Doctors with borders: Occupational Licensing as an implicit barrier to high skill migration
    Public Choice, 2014
    Co-Authors: Brenton D. Peterson, Sonal S. Pandya, David Leblang
    Abstract:

    Research on the political economy of immigration overlooks the specificity of human capital in skilled occupations and its implications for immigration preferences and policymaking. Conclusions that skilled Americans are unconcerned about labor market competition from skilled migrants build on a simple dichotomy between high and low skill migrants. In this article we show that natives turn to Occupational Licensing regulations as occupation-specific protectionist barriers to skilled migrant labor competition. In practice, high skill natives face labor market competition only from those high-skill migrants who share their occupation-specific skills. Licensure regulations ostensibly serve the public interest by certifying competence, but they can simultaneously be formidable barriers to entry by skilled migrants. From a collective action perspective, skilled natives can more easily secure sub-national, occupation-specific policies than influence national immigration policy. We exploit the unique structure of the American medical profession that allows us to distinguish between public interest and protectionist motives for migrant physician licensure regulations. We show that over the 1973–2010 period states with greater physician control over licensure requirements imposed more stringent requirements for migrant physician licensure and, as a consequence, received fewer new migrant physicians. By our estimates over a third of all US states could reduce their physician shortages by at least 10 percent within 5 years just by equalizing migrant and native licensure requirements. This article advances research on the political economy of immigration and highlights an overlooked dimension of international economic integration: regulatory rent-seeking as a barrier to the cross-national mobility of human capital, and the public policy implications of such barriers.

  • doctors with borders Occupational Licensing as an implicit barrier to high skill migration
    Social Science Research Network, 2013
    Co-Authors: Brenton D. Peterson, Sonal S. Pandya, David Leblang
    Abstract:

    Research on the political economy of immigration overlooks the specificity of skills in high skill occupations and its implications for immigration preferences and policymaking. Assessments that skilled Americans are unconcerned about labor market competition from skilled migrants build on a simple dichotomy between high and low skill migrants. In this article we show that natives turn to Occupational Licensing regulations as occupation-specific, protectionist barriers to skilled migrant labor competition. In practice, high skill natives face labor market competition from only those high-skill migrants who share their occupation-specific skills. Licensure regulations ostensibly serve the public interest by certifying competence but they can simultaneously be formidable barriers to skilled migrants’ labor entry. From a collective action perspective, skilled natives can more easily secure subnational, occupation-specific policies than influence national immigration policy. We exploit the unique structure of the American medical profession that allows us to distinguish between public interest and protectionist motives for migrant physician licensure regulations. We show that over the period 1973-2010 states with greater physician control over licensure requirements imposed more stringent requirements for migrant physician licensure and, as a consequence, received fewer new migrant physicians. By our estimates half of all US states could resolve their physician shortages within five year just by equalizing migrant and native licensure requirements. This article advances research on the political economy of immigration and highlights an overlooked dimension of international economic integration: regulatory rent-seeking as a barrier to the cross-national mobility of human capital, and the public policy implications of such barriers.

Edward Timmons - One of the best experts on this subject based on the ideXlab platform.

  • a primer on emergency Occupational Licensing reforms for combating covid 19
    Social Science Research Network, 2020
    Co-Authors: Ethan Bayne, Conor Norris, Edward Timmons
    Abstract:

    The pandemic of COVID-19 has created a significant strain on the healthcare system in the United States. As the effects of the COVID-19 pandemic continue to spread, these numbers are only expected to increase, and with that so does the potential to overwhelm the US healthcare system. American regulatory policy limits the country’s healthcare capacity in a variety of ways. In response, states must consider a range of temporary measures to allow the supply of healthcare professionals to meet the sudden growing demand and provide adequate care to patients. The existing web of state Occupational Licensing laws creates rigidity in healthcare labor supply. In this brief we highlight actions states have taken to reform Occupational Licensing, and we produce a novel ranking of these interventions as guidance to policymakers. In this special edition policy brief, we highlight how Occupational Licensing creates a lack of flexibility in the market for healthcare professionals. We then analyze recent action taken by states to combat the crisis, and we offer a novel ranking of which interventions are likely to be most effective in adding healthcare staff capacity.

  • the effects of growth in Occupational Licensing on intergenerational mobility
    Social Science Research Network, 2019
    Co-Authors: Edward Timmons, Brian Meehan, Andrew Meehan, Ilya Kukaev
    Abstract:

    We use a newly produced data set on growth in Occupational Licensing of low-income occupations to estimate the relationship between growth in Occupational Licensing and intergenerational mobility. Our empirical results suggest growth in state Licensing is associated with a 1.6% to 6.2% reduction in absolute mobility at the county level. Growth in Licensing is also associated with increases in county level Gini coefficients (and thus income inequality) ranging from 3.9% to 15.4%. The relationship between the growth in licensed occupations and absolute mobility provides suggestive evidence of loss in opportunity and reduced mobility for potential entrants into these occupations.

  • bringing the effects of Occupational Licensing into focus optician Licensing in the united states
    Social Science Research Network, 2015
    Co-Authors: Edward Timmons, Anna Mills
    Abstract:

    The scope and scale of Occupational Licensing in the United States continues to grow. Our study finds that stricter optician Licensing laws and laws that have been in place for longer periods of time result in higher optician earnings. On the other hand, there is little evidence that Licensing has affected vision insurance or optician malpractice insurance premiums. Optician Licensing increases optician earnings with no measurable benefit to consumers.