The Impact of Potential Labor Supply on Licensing Exam Difficulty in the US Market for Lawyers
AbstractThis paper provides the first empirical evidence of a positive impact of the quality and number of potential entrants on entry requirements in professional markets. The estimated effects are so large that increases in the quality of candidates are completely offset by increases in exam difficulty and therefore do not lead to any long run increase in the number of successful candidates. Variations in the number of candidates are also significantly (but not completely) offset by changes in exam difficulty. About one third of the additional candidates that otherwise would have passed the examination fail because of the increase in standards. These results are not in line with public interest theory of licensing. The classic rent seeking view of licensing can explain some (but not all) of the results.
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Bibliographic InfoPaper provided by CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY in its series CHILD Working Papers with number wp19_08.
Length: 52 pages
Date of creation: Apr 2007
Date of revision:
professional licensing; legal market; bar exam; minimum standards; entry regulation;
Other versions of this item:
- Mario Pagliero, 2011. "The Impact of Potential Labor Supply on Licensing Exam Difficulty in the US Market for Lawyers," Working papers 18, Former Department of Economics and Public Finance "G. Prato", University of Torino, revised May 2013.
- L4 - Industrial Organization - - Antitrust Issues and Policies
- L5 - Industrial Organization - - Regulation and Industrial Policy
- J4 - Labor and Demographic Economics - - Particular Labor Markets
- K2 - Law and Economics - - Regulation and Business Law
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