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Occupational licensing is essentially the government regulating an occupation for the public’s safety. It is a government permission slip for a person to work. It takes many forms such as a license, fees, education/exam requirement, and age requirements.

Some occupational licenses are totally legitimate and may even be necessary. Most people think of occupations like doctors, nurses, lawyers and pharmacists as “licensed” occupations. However, hundreds of occupations now require a license before a person can start working.

Making it harder for a person to engage in an occupation means less people in that occupation. This is called a barrier to entry. Less people in an occupation means less competition. Less competition means higher prices for consumers. Put simply, burdensome occupational licensing means higher prices for people.

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If a business succeeds and captures most of the market share of an industry in a free market, then good for them. But over-burdensome occupational licensing uses GOVERNMENT to shield businesses from competition.

The rise of over-burdensome regulations is driven by industries lobbying for more occupational licensing on themselves. This creates the very thing that ensures more money for them – less competition. Legislators point to this as a reason to increase occupational licensing stating that “the industry wants this.” What they truly want though is to stop other people from competing against them.

The Institute for Justice just released a comprehensive report on occupational licensing in the states. This quiz will highlight key statistics and takeaways from that report to educate you on occupational licensing in Arkansas.

Question Sources:
http://ij.org/wp-content/themes/ijorg/images/ltw2/License_to_Work_2nd_Edition.pdf