IDEAS home Printed from https://ideas.repec.org/a/wly/soecon/v84y2017i1p297-316.html
   My bibliography  Save this article

The Demand for Healthcare Regulation: The Effect of Political Spending on Occupational Licensing Laws

Author

Listed:
  • Benjamin J. McMichael

Abstract

Using data on political spending in state elections, this study considers the role of political contributions by healthcare professional interest groups in states' decisions to enact occupational licensing laws. These laws govern how different professions may operate in healthcare markets, and while they ostensibly exist to protect consumers, licensing laws can also insulate professionals from competition in healthcare markets. Higher political spending by physician interest groups increases the probability that a state maintains licensing laws restricting the practices of nurse practitioners (NPs) and physician assistants (PAs). Conversely, increased spending by hospital interest groups increases the probability that a state allows NPs and PAs to practice with more autonomy. Nurse groups, which include groups affiliated with NPs, have a smaller effect on licensing laws. And nonphysician groups, which include groups affiliated with PAs, have almost no effect on licensing laws. These results are consistent with the investment theory of political spending.

Suggested Citation

  • Benjamin J. McMichael, 2017. "The Demand for Healthcare Regulation: The Effect of Political Spending on Occupational Licensing Laws," Southern Economic Journal, John Wiley & Sons, vol. 84(1), pages 297-316, July.
    • Handle: RePEc:wly:soecon:v:84:y:2017:i:1:p:297-316
    DOI: 10.1002/soej.12211
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/soej.12211
    Download Restriction: no
    File URL: https://libkey.io/10.1002/soej.12211?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Tamer, Elie, 2010. "Partial Identification in Econometrics," Scholarly Articles 34728615, Harvard University Department of Economics.
    2. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
    3. Stephen Ansolabehere & John M. de Figueiredo & James M. Snyder Jr, 2003. "Why is There so Little Money in U.S. Politics?," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 105-130, Winter.
    4. Stange, Kevin, 2014. "How does provider supply and regulation influence health care markets? Evidence from nurse practitioners and physician assistants," Journal of Health Economics, Elsevier, vol. 33(C), pages 1-27.
    5. Morris M. Kleiner & Allison Marier & Kyoung Won Park & Coady Wing, 2016. "Relaxing Occupational Licensing Requirements: Analyzing Wages and Prices for a Medical Service," Journal of Law and Economics, University of Chicago Press, vol. 59(2), pages 261-291.
    6. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2008. "Using Selection on Observed Variables to Assess Bias from Unobservables When Evaluating Swan-Ganz Catheterization," American Economic Review, American Economic Association, vol. 98(2), pages 345-350, May.
    7. David P. Baron, 2001. "Theories of Strategic Nonmarket Participation: Majority‐Rule and Executive Institutions," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(1), pages 47-89, March.
    8. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-850, September.
    9. Max Schanzenbach, 2010. "The Impact of Tort Reform on Private Health Insurance Coverage, February 2010," American Law and Economics Review, American Law and Economics Association, vol. 12(2), pages 263-264.
    10. Tripathi Micky & Ansolabehere Stephen & Jr James M. Snyder, 2002. "Are PAC Contributions and Lobbying Linked? New Evidence from the 1995 Lobby Disclosure Act," Business and Politics, De Gruyter, vol. 4(2), pages 1-26, August.
    11. Michael Dueker & Ada Jacox & David Kalist & Stephen Spurr, 2005. "The Practice Boundaries of Advanced Practice Nurses: An Economic and Legal Analysis," Journal of Regulatory Economics, Springer, vol. 27(3), pages 309-330, January.
    12. John J. Perry, 2009. "The Rise And Impact Of Nurse Practitioners And Physician Assistants On Their Own And Cross‐Occupation Incomes," Contemporary Economic Policy, Western Economic Association International, vol. 27(4), pages 491-511, October.
    13. Wolton, Stephane, 2016. "Lobbying, Inside and Out: How Special Interest Groups Influence Policy Choices," MPRA Paper 68637, University Library of Munich, Germany.
    14. Timothy Werner & John J. Coleman, 2015. "Citizens United, Independent Expenditures, and Agency Costs: Reexamining the Political Economy of State Antitakeover Statutes," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 31(1), pages 127-159.
    15. Kleiner, Morris M & Kudrle, Robert T, 2000. "Does Regulation Affect Economic Outcomes? The Case of Dentistry," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 547-582, October.
    16. Nicola Persico, 2015. "The Political Economy of Occupational Licensing Associations," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 31(2), pages 213-241.
    17. Hall, Richard L. & Wayman, Frank W., 1990. "Buying Time: Moneyed Interests and the Mobilization of Bias in Congressional Committees," American Political Science Review, Cambridge University Press, vol. 84(3), pages 797-820, September.
    18. Avraham, Ronen & Schanzenbach, Max, 2015. "The impact of tort reform on intensity of treatment: Evidence from heart patients," Journal of Health Economics, Elsevier, vol. 39(C), pages 273-288.
    19. Rui J. P. De Figueiredo & Geoff Edwards, 2007. "Does Private Money Buy Public Policy? Campaign Contributions and Regulatory Outcomes in Telecommunications," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(3), pages 547-576, September.
    20. A. Frank Adams III & Robert B. Ekelund Jr. & John D. Jackson, 2003. "Occupational Licensing of a Credence Good: The Regulation of Midwifery," Southern Economic Journal, John Wiley & Sons, vol. 69(3), pages 659-675, January.
    21. Robert J. Thornton & Edward J. Timmons, 2013. "Licensing One of the World's Oldest Professions: Massage," Journal of Law and Economics, University of Chicago Press, vol. 56(2), pages 371-388.
    22. Elie Tamer, 2010. "Partial Identification in Econometrics," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 167-195, September.
    23. Tripathi, Micky & Ansolabehere, Stephen & Snyder, James M., 2002. "Are PAC Contributions and Lobbying Linked? New Evidence from the 1995 Lobby Disclosure Act," Business and Politics, Cambridge University Press, vol. 4(2), pages 131-155, August.
    24. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(3), pages 371-400.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Shishir Shakya & Joshua K. Bedi & Alicia Plemmons, 2024. "Healthcare Workforce Shortages and Job Autonomy: Nurse Practitioners and Entrepreneurship in the United States," Working Papers 24-08, Department of Economics, Appalachian State University.
    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. Shishir Shakya & Alicia Plemmons, 2020. "Does Scope of Practice Affect Mobility of Nurse Practitioners Serving Medicare Beneficiaries?," Journal of Labor Research, Springer, vol. 41(4), pages 421-434, December.
    4. Laura Barrie Smith, 2022. "The effect of nurse practitioner scope of practice laws on primary care delivery," Health Economics, John Wiley & Sons, Ltd., vol. 31(1), pages 21-41, January.
    5. Traczynski, Jeffrey & Udalova, Victoria, 2018. "Nurse practitioner independence, health care utilization, and health outcomes," Journal of Health Economics, Elsevier, vol. 58(C), pages 90-109.
    6. McMichael, Benjamin, 2017. "Beyond Physicians: The Effect of Licensing and Liability Laws on the Supply of Nurse Practitioners and Physician Assistants," Working Papers 07538, George Mason University, Mercatus Center.
    7. Ilya Kukaev & Edward J. Timmons, 2023. "Certifiably employable?: The effects of occupational regulation on unemployment duration," Working Papers 23-02, Department of Economics, West Virginia University.
    8. Kanazawa, Mark Tooru, 2023. "The Efficiency of Occupational Licensing during the Gilded and Progressive Eras: Evidence from Judicial Review," The Journal of Economic History, Cambridge University Press, vol. 83(4), pages 1221-1252, December.
    9. Yelowitz, Aaron & Ingram, Samuel J., 2021. "How Does Occupational Licensing Affect Entry into the Medical Field? An Examination of EMTs," IZA Discussion Papers 14071, Institute of Labor Economics (IZA).
    10. Kihwan Bae & Edward Timmons, 2023. "Now You Can Take It with You: Effects of Occupational Credential Recognition on Labor Market Outcomes," Working Papers 23-03, Department of Economics, West Virginia University.
    11. Xia, Xing, 2021. "Barrier to Entry or Signal of Quality? The Effects of Occupational Licensing on Minority Dental Assistants," Labour Economics, Elsevier, vol. 71(C).
    12. Peter T. Leeson & Henry A. Thompson, 2023. "Public choice and public health," Public Choice, Springer, vol. 195(1), pages 5-41, April.
    13. Suyoun Han & Morris M. Kleiner, 2021. "Analyzing the Influence of Occupational Licensing Duration and Grandfathering on Wage Determination," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 60(2), pages 147-187, April.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. McMichael, Benjamin, 2017. "Beyond Physicians: The Effect of Licensing and Liability Laws on the Supply of Nurse Practitioners and Physician Assistants," Working Papers 07538, George Mason University, Mercatus Center.
    2. Richard Damania & Per G. Fredriksson & Thomas Osang, 2005. "Polluters and Collective Action: Theory and Evidence," Southern Economic Journal, John Wiley & Sons, vol. 72(1), pages 167-185, July.
    3. Rui J. P. De Figueiredo & Geoff Edwards, 2007. "Does Private Money Buy Public Policy? Campaign Contributions and Regulatory Outcomes in Telecommunications," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(3), pages 547-576, September.
    4. Peter T. Leeson & Henry A. Thompson, 2023. "Public choice and public health," Public Choice, Springer, vol. 195(1), pages 5-41, April.
    5. William R. Kerr & William F. Lincoln & Prachi Mishra, 2014. "The Dynamics of Firm Lobbying," American Economic Journal: Economic Policy, American Economic Association, vol. 6(4), pages 343-379, November.
    6. Tatyana Chesnokova, 2010. "Lobby Interaction and Trade Policy," School of Economics and Public Policy Working Papers 2010-04, University of Adelaide, School of Economics and Public Policy.
    7. Cotton, Christopher, 2012. "Pay-to-play politics: Informational lobbying and contribution limits when money buys access," Journal of Public Economics, Elsevier, vol. 96(3), pages 369-386.
    8. Bonardi, Jean-Philippe & Urbiztondo, Santiago, 2013. "Asset freezing, corporate political resources and the Tullock paradox," Business and Politics, Cambridge University Press, vol. 15(3), pages 275-293, October.
    9. Brian Kelleher Richter & Krislert Samphantharak & Jeffrey F. Timmons, 2009. "Lobbying and Taxes," American Journal of Political Science, John Wiley & Sons, vol. 53(4), pages 893-909, October.
    10. Cotton, Christopher, 2015. "Competing for Attention," MPRA Paper 65715, University Library of Munich, Germany.
    11. Christopher Cotton, 2010. "Pay-to-Play Politics: Informational lobbying and campaign finance reform when contributions buy access," Working Papers 2010-22, University of Miami, Department of Economics.
    12. Bombardini, Matilde & Trebbi, Francesco, 2012. "Competition and political organization: Together or alone in lobbying for trade policy?," Journal of International Economics, Elsevier, vol. 87(1), pages 18-26.
    13. Xia, Xing, 2021. "Barrier to Entry or Signal of Quality? The Effects of Occupational Licensing on Minority Dental Assistants," Labour Economics, Elsevier, vol. 71(C).
    14. Seung-Hyun Lee & Mine Ozer & Yoon-Suk Baik, 2018. "The impact of political connections on government bailout: the 2008 credit crunch in the United States," Economics of Governance, Springer, vol. 19(4), pages 299-315, November.
    15. Stange, Kevin, 2014. "How does provider supply and regulation influence health care markets? Evidence from nurse practitioners and physician assistants," Journal of Health Economics, Elsevier, vol. 33(C), pages 1-27.
    16. Mario Pagliero, 2019. "Occupational Licensing in the EU: Protecting Consumers or Limiting Competition?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 55(1), pages 137-153, August.
    17. Bombardini, Matilde & Trebbi, Francesco, 2011. "Votes or money? Theory and evidence from the US Congress," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 587-611, August.
    18. Jürgen Huber & Michael Kirchler, 2013. "Corporate campaign contributions and abnormal stock returns after presidential elections," Public Choice, Springer, vol. 156(1), pages 285-307, July.
    19. Christopher Cotton, 2009. "Competition for Access and Full Revelation of Evidence," Working Papers 2010-12, University of Miami, Department of Economics.
    20. Michael J. Barber & Brandice Canes‐Wrone & Sharece Thrower, 2017. "Ideologically Sophisticated Donors: Which Candidates Do Individual Contributors Finance?," American Journal of Political Science, John Wiley & Sons, vol. 61(2), pages 271-288, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:soecon:v:84:y:2017:i:1:p:297-316. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1002/(ISSN)2325-8012 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.