208 Sirrine Hall
Institutional Affiliation: Clemson University
NBER Working Papers and Publications
|November 2018||How Much of Barrier to Entry is Occupational Licensing?|
with Peter Q. Blair: w25262
We exploit state variation in licensing laws to study the effect of licensing on occupational choice using a boundary discontinuity design. We find that licensing reduces equilibrium labor supply by an average of 17%-27%. The negative labor supply effects of licensing appear to be strongest for white workers and comparatively weaker for black workers.
|July 2018||Job Market Signaling through Occupational Licensing|
with Peter Q. Blair: w24791
We show that an occupational license serves as a job market signal, similar to education in the Spence model. In the presence of occupational licensing, we find evidence that firms rely less on observable characteristics such as race and gender in determining employee wages. As a result, licensed minorities and women experience smaller wage gaps than their unlicensed peers. Black men benefit from licenses that signal non-felony status, whereas white women benefit from licenses with a human capital requirement. Certification, a less distortionary alternative to licensing, generates an equivalent wage premium for white men, but lower wage premiums than licensing for women and black men.