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The Effect of State Funeral Regulations on Cremations Rates: Testing for Demand Inducement in Funeral Markets

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  • Harrington, David E
  • Krynski, Kathy J

Abstract

This article presents evidence that state funeral regulations affect the choice of whether to cremate or bury dead bodies. States that require either funeral directors to be embalmers or funeral homes to have embalming preparation rooms have lower cremation rates, holding other factors such as income, age, educational attainment, nativity, religious adherence, race, and region constant. These embalming regulations reduce cremation rates by roughly 16 percent, which increases the amount spent on funerals by 2.6 percent. The article also presents evidence that funeral directors induce consumers to choose burial over cremation, which supports one of the fundamental premises underlying the Federal Trade Commission's Funeral Rule. However, the additional evidence that inducement is more prevalent in states with stringent funeral regulations suggests that repealing state regulations that impede competition might be more effective than the Funeral Rule in attacking the problem of demand inducement. Copyright 2002 by the University of Chicago.

Suggested Citation

  • Harrington, David E & Krynski, Kathy J, 2002. "The Effect of State Funeral Regulations on Cremations Rates: Testing for Demand Inducement in Funeral Markets," Journal of Law and Economics, University of Chicago Press, vol. 45(1), pages 199-225, April.
  • Handle: RePEc:ucp:jlawec:v:45:y:2002:i:1:p:199-225
    DOI: 10.1086/324652
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    References listed on IDEAS

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    1. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, September.
    2. Maloney, Michael T & McCormick, Robert E, 1982. "A Positive Theory of Environmental Quality Regulation," Journal of Law and Economics, University of Chicago Press, vol. 25(1), pages 99-123, April.
    3. Ekelund, Robert B, Jr & Ford, George S, 1997. "Nineteenth Century Urban Market Failure?: Chadwick on Funeral Industry Regulation," Journal of Regulatory Economics, Springer, vol. 12(1), pages 27-51, July.
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    Cited by:

    1. Canofari Paolo & Marini Giancarlo & Scaramozzino Pasquale, 2014. "To sleep, perchance to dream: Prices for burial spaces in US states," wp.comunite 0114, Department of Communication, University of Teramo.
    2. Mario Pagliero & Edward Timmons, 2012. "Occupational Regulation in the European Legal Market," Working papers 27, Former Department of Economics and Public Finance "G. Prato", University of Torino.
    3. Judith A. Chevalier & Fiona M. Scott Morton, 2008. "State Casket Sales Restrictions: A Pointless Undertaking?," Journal of Law and Economics, University of Chicago Press, vol. 51(1), pages 1-23, February.
    4. Daniel J. Smith & Noah J. Trudeau, 2019. "The Undertaker’s Cut: Challenging the Rational Basis for Casket Licensure," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 34(Summer 20), pages 23-41.
    5. Judith Chevalier & Fiona Scott Morton, 2006. "State Casket Sales and Restrictions: A Pointless Undertaking?," NBER Working Papers 12012, National Bureau of Economic Research, Inc.
    6. Pagliero, Mario, 2013. "The impact of potential labor supply on licensing exam difficulty," Labour Economics, Elsevier, vol. 25(C), pages 141-152.
    7. Francisco Marcos, 2003. "La economía funeraria: demanda y oferta en el mercado de servicios funerarios," Working Papers Economia wpe03-18, Instituto de Empresa, Area of Economic Environment.
    8. Lori Parcel, 2008. "Stiff Competition: Vertical Relationships in Cremation Services," Discussion Papers 07-041, Stanford Institute for Economic Policy Research.
    9. 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.
    10. Lefgren Lars & McIntyre Frank L & Miller Michelle, 2010. "Chapter 7 or 13: Are Client or Lawyer Interests Paramount?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-46, September.
    11. repec:inr:wpaper:248290 is not listed on IDEAS
    12. Paolo Canofari & Giancarlo Marini & Pasquale Scaramozzino, 2013. "To Sleep, Perchance to Dream: Prices for Funeral Homes in US States," CEIS Research Paper 260, Tor Vergata University, CEIS, revised 11 Jan 2013.
    13. Canofari, Paolo & Marini, Giancarlo & Scaramozzino, Pasquale, 2017. "The importance of being remembered: Prices for cemetery plots in the US," Economic Modelling, Elsevier, vol. 64(C), pages 638-645.
    14. Pizzola, Brandon & Tabarrok, Alexander, 2017. "Occupational licensing causes a wage premium: Evidence from a natural experiment in Colorado’s funeral services industry," International Review of Law and Economics, Elsevier, vol. 50(C), pages 50-59.
    15. Thierry Blayac & Patrice Bougette & Christian Montet, 2014. "How consumer information curtails market power in the funeral industry," European Journal of Law and Economics, Springer, vol. 37(3), pages 421-437, June.
    16. repec:inr:wpaper:248291 is not listed on IDEAS
    17. Jerry Ellig, 2015. "State funeral regulations: inside the black box," Journal of Regulatory Economics, Springer, vol. 48(1), pages 97-123, August.
    18. David E. Harrington & Jaret Treber, 2020. "Constraining Competition With State Mandated Facility Requirements," Contemporary Economic Policy, Western Economic Association International, vol. 38(4), pages 659-674, October.
    19. Alison Cathles & David E. Harrington & Kathy Krynski, 2010. "The Gender Gap in Funeral Directors: Burying Women with Ready‐to‐Embalm Laws?," British Journal of Industrial Relations, London School of Economics, vol. 48(4), pages 688-705, December.
    20. Mario Pagliero & Edward Timmons, 2013. "Occupational Regulation in the European Legal Market," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(2), pages 243-265, August.

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