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Journal of Regulatory Economics

, Volume 52, Issue 2, pp 132–158 | Cite as

Analyzing occupational licensing among the states

  • Morris M. KleinerEmail author
  • Evgeny Vorotnikov
Original Article

Abstract

The study provides new evidence of the influence of occupational regulations on the U.S. economy. Our analysis, unlike previous studies, was able to obtain a representative sample of the population at the state level, which allowed us to estimate the cross-sectional effects of occupational licensing for each state. The state-level analysis demonstrates considerable variation in percentage of the workforce that has attained a license, and unlike minimum wages or unionization, licensing shows no regional patterns in the distribution of occupational licensing. The analysis also shows considerable variation in the influence of licensing on earnings across the states. The national estimates suggest that occupational licensing raises wages by about 11% after controlling for human capital and other observable characteristics. Finally, our analysis shows the influence of occupational regulation on wage inequality across the income distribution.

Keywords

Occupational licensing Wage determination with occupational licensing Income inequality with occupational licensing 

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Copyright information

© Springer Science+Business Media New York 2017

Authors and Affiliations

  1. 1.University of Minnesota, NBERMinneapolisUSA
  2. 2.Federal Reserve Bank of MinneapolisMinneapolisUSA
  3. 3.Fannie MaeWashingtonUSA

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