621. Is Professional Licensing a Racket?

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4.6 • 32K Ratings

🗓️ 7 February 2025

⏱️ 55 minutes

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Summary

Licensing began with medicine and law; now it extends to 20 percent of the U.S. workforce, including hair stylists and auctioneers. In a new book, the legal scholar Rebecca Allensworth calls licensing boards “a thicket of self-dealing and ineptitude” and says they keep bad workers in their jobs and good ones out — while failing to protect the public.

Transcript

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0:00.0	Hey there, it's Stephen Dubner with one last reminder to come see Freakonomics Radio
0:07.9	live in Los Angeles on February 13th.
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0:21.7	Billy Elish, Elton John, and coming soon, the Dodgers Yankees World Series.
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0:40.4	Only a few left. February 13th in LA, produced in partnership with LAist and Sirius XM. I'll see you there.
0:51.6	What does a hairdresser have in common with a lawyer?
0:58.4	How about an interior designer and a doctor, an auctioneer, and a funeral director?
1:05.7	These are not jokes.
1:07.9	I'm sorry.
1:08.6	I wish they were.
1:09.8	What these jobs all have in common is that they require
1:12.7	a professional license, which is administered by a licensing board that is often made up of other
1:18.5	doctors and funeral directors and hairdressers. This may not be something you've ever thought about,
1:25.4	and I wouldn't blame you. It's one of those things a friend of mine calls a mego topic. Migo standing for it. My eyes glaze over. But when you think about how our economy works, these labor licensing rules are pretty important. It is the most important regulatory institution we have in labor.
1:48.0	Rebecca Allensworth is a law professor at Vanderbilt University, and she's written a book about professional licensing.
1:51.0	We Americans like to think of our economy as open and dynamic.
1:56.0	Allensworth shows that in many ways it's not,
	...

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