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Is reform contagious?: The diffusion of universal recognition reforms

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  • Conor Norris

    (West Virginia University)

Abstract

States commonly rely on occupational licensing laws to protect consumers; however, these laws can have substantial costs. As the recognition of the costs of licensing has grown, many states have been implementing reforms. The most common reform is the universal recognition of out-of-state licenses, which makes it easier to transfer a license from another state. Using spatial econometrics techniques, I examine factors related to a state’s choice to adopt universal recognition, testing whether adoption can be explained by proximity or characteristics within a state. Relying on a spatial autoregressive model, I find evidence that universal recognition adoption can be explained by the tightness of the labor market, economic conservatism, and fewer licensing barriers, suggesting that adoption of the reform is largely driven by characteristics of each state. While the diffusion of policy is usually influenced by the adoption of neighbors, for universal recognition, this does not appear to be the case.

Suggested Citation

  • Conor Norris, 2024. "Is reform contagious?: The diffusion of universal recognition reforms," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 48(4), pages 1214-1232, December.
    • Handle: RePEc:spr:jecfin:v:48:y:2024:i:4:d:10.1007_s12197-024-09694-7
    DOI: 10.1007/s12197-024-09694-7
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    References listed on IDEAS

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    More about this item

    Keywords

    Policy diffusion; Occupational licensing; State policy; Spatial autocorrelation;
    All these keywords.

    JEL classification:

    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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