Distribution, Competition, and Antitrust / IP Law

Is Professional Licensing a Drag on the Economy?

The Planetmoney folks have an interesting episode entitled “why it’s illegal to braid hair without a license.”  The episode discusses the experience of one part-time African-style hair braider in Utah whose business was shut down by a state licensing board.  The episode presents the viewpoint that over-licensing is often unnecessary, sometimes exclusionary, and interferes with the supply and movement of labor in the labor market (not necessarily a good thing in an economic downturn).

Some of these arguments are familiar, but one statistic in the episode caught my ear: some 50 years ago, only one out of 20 workers was licensed.  Now, the statistic is one out of three. 

I suspect that statistic defines “license” rather broadly (perhaps to include any sort of registration requirement).  Nevertheless, it’s quite striking.

Here’s my take on the licensing system in the U.S. legal system.

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About Howard Ullman

Antitrust, competition, and IP law enthusiast.

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