Analyzing occupational licensing among the states

The study discusses regional patterns in the distribution of occupational licensing, the influence of licensing on earnings across the states, and the influence of occupational regulation on wage inequality.

Morris M. Kleiner and Evgeny Vorotnikov

June 19, 2017


The study provides new evidence of the influence of occupational regula-
tions 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.

Read the full article here: Kleiner – Analyzing occupational

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