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Was Occupational Licensing Good for Minorities? A Critique of Marc Law and Mindy Marks*

* This paper is a replication of an original study

Author

Listed:
  • Daniel B. Klein
  • Benjamin Powell
  • Evgeny S. Vorotnikov

Abstract

A 2009 Journal of Law and Economics article by Marc T. Law and Mindy S. Marks suggests that during the period 1890-1950 occupational licensing did not tend to affect blacks and women adversely. The biggest problem with the paper is that a Census-reported practitioner in a licensing state is not necessarily licensed—a fact never mentioned by Law and Marks—and yet that fact should greatly affect their treatment of the data and results. Information about plumbers in Maryland reveals that in treating the Census number of black plumbers as licensed black plumbers—as Law and Marks implicitly do—they overstate the actual number by 4700 percent. It is therefore unsurprising that they do not find plumbing licensing to have negatively impacted blacks. The paper suffers from several other problems, as well, including: Law and Marks lump certification in with licensing; there is a sample selection bias in their method for including an occupation in the study; several of their findings are based on extremely low participation by blacks and women; they treat women as the “minority” in the field of nursing. Because of these and other problems, including the results of falsification tests, we judge their conclusions to be highly doubtful.

Suggested Citation

  • Daniel B. Klein & Benjamin Powell & Evgeny S. Vorotnikov, 2012. "Was Occupational Licensing Good for Minorities? A Critique of Marc Law and Mindy Marks," Econ Journal Watch, Econ Journal Watch, vol. 9(3), pages 210-233, September.
    • Handle: RePEc:ejw:journl:v:9:y:2012:i:3:p:210-233
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    References listed on IDEAS

    as
    1. E. Frank Stephenson & Erin E. Wendt, 2009. "Occupational Licensing: Scant Treatment in Labor Texts," Econ Journal Watch, Econ Journal Watch, vol. 6(2), pages 181-194, May.
    2. Leland, Hayne E, 1979. "Quacks, Lemons, and Licensing: A Theory of Minimum Quality Standards," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1328-1346, December.
    3. Pagliero, Mario, 2011. "What is the objective of professional licensing? Evidence from the US market for lawyers," International Journal of Industrial Organization, Elsevier, vol. 29(4), pages 473-483, July.
    4. Morris M. Kleiner, 2006. "Licensing Occupations: Ensuring Quality or Restricting Competition?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number lo, November.
    5. Armen A. Aichian & Reuben A. Kessel, 1962. "Competition, Monopoly, and the Pursuit of Pecuniary Gain," NBER Chapters, in: Aspects of Labor Economics, pages 157-183, National Bureau of Economic Research, Inc.
    6. David Barker, 2008. "Ethics and Lobbying: The Case of Real Estate Brokerage," Journal of Business Ethics, Springer, vol. 80(1), pages 23-35, June.
    7. Marc T. Law & Mindy S. Marks, 2013. "From Certification To Licensure: Evidence From Registered And Practical Nurses In The United States, 1950-1970," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(2), pages 177-198, August.
    8. Karl Widerquist, 2012. "Reply to Comments," Exploring the Basic Income Guarantee, in: Karl Widerquist & Michael W. Howard (ed.), Exporting the Alaska Model, chapter 0, pages 233-240, Palgrave Macmillan.
    9. Hanushek, Eric A., 2011. "The economic value of higher teacher quality," Economics of Education Review, Elsevier, vol. 30(3), pages 466-479, June.
    10. Klein, Daniel B., 2014. "Knowledge and Coordination: A Liberal Interpretation," OUP Catalogue, Oxford University Press, number 9780199355327, Decembrie.
    11. Law, Marc T. & Kim, Sukkoo, 2005. "Specialization and Regulation: The Rise of Professionals and the Emergence of Occupational Licensing Regulation," The Journal of Economic History, Cambridge University Press, vol. 65(3), pages 723-756, September.
    12. Anonymous, 1952. "Occupational Licensing Legislation in the States. (Chicago: The Council of State Governments. 1952. Pp. 112. $3.00.)," American Political Science Review, Cambridge University Press, vol. 46(4), pages 1197-1197, December.
    13. Simon Rottenberg, 1980. "Occupational Licensure and Regulation," Books, American Enterprise Institute, number 968900, September.
    14. Marc T. Law & Mindy S. Marks, 2009. "Effects of Occupational Licensing Laws on Minorities: Evidence from the Progressive Era," Journal of Law and Economics, University of Chicago Press, vol. 52(2), pages 351-366, May.
    15. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    16. Maya N. Federman & David E. Harrington & Kathy J. Krynski, 2006. "The Impact of State Licensing Regulations on Low-Skilled Immigrants: The Case of Vietnamese Manicurists," American Economic Review, American Economic Association, vol. 96(2), pages 237-241, May.
    17. Shirley Svorny, 2004. "Licensing Doctors: Do Economists Agree?," Econ Journal Watch, Econ Journal Watch, vol. 1(2), pages 279-305, August.
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    Cited by:

    1. Vincent Geloso & Raymond J. March, 2021. "Rent seeking for madness: the political economy of mental asylums in the United States, 1870 to 1910," Public Choice, Springer, vol. 189(3), pages 375-404, December.
    2. Dustin Chambers & Colin O’Reilly, 2022. "The economic theory of regulation and inequality," Public Choice, Springer, vol. 193(1), pages 63-78, October.
    3. Marc T. Law & Mindy S. Marks, 2012. "Occupational Licensing and Minorities: A Reply to Klein, Powell, and Vorotnikov," Econ Journal Watch, Econ Journal Watch, vol. 9(3), pages 234-255, September.

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    Replication

    This item is a replication of:
  • Marc T. Law & Mindy S. Marks, 2009. "Effects of Occupational Licensing Laws on Minorities: Evidence from the Progressive Era," Journal of Law and Economics, University of Chicago Press, vol. 52(2), pages 351-366, May.

    • More about this item

    Keywords

    Occupational licensure; licensing; race; gender; discrimination;
    All these keywords.

    JEL classification:

    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations

    Lists

    This item is featured on the following reading lists, Wikipedia, or ReplicationWiki pages:
    1. Was Occupational Licensing Good for Minorities? A Critique of Marc Law and Mindy Marks (EJW 2012) in ReplicationWiki

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