Working papers
The Origins and Evolution of Occupational Licensing in the United States (with Jason Hicks, Andrew Karch, and Morris Kleiner)
Download paper (updated March 2025); NBER Working Paper
The analysis of occupational licensing has concentrated largely on its labor market and consumer welfare effects. By contrast, relatively little is known about how occupational licensing laws originated or the key factors in their evolution. In this paper, we study the determinants of U.S. licensing requirements from 1870 to 2020. We begin by developing a model where licensing arises as an endogenous political outcome and use this framework to study how market characteristics and political incentives influence regulators’ choices. Our empirical analysis draws on a novel database tracking the initial enactment of licensing legislation for hundreds of unique occupations, as well as changes to the specific qualifications required to obtain a subset of licenses over time. We first show that, consistent with the predictions of our model, licensing requirements are more common and were adopted earlier for occupations whose tasks plausibly pose some risk to consumers. Second, large, urbanized states are significantly more likely to produce new policies. Third, among occupations regulated before 1940, licensing requirements appeared earlier in states with more practitioners and where incumbent workers likely experienced greater labor market competition. After 1980, state-level factors are more strongly associated with the timing of policy adoption. Finally, political organization, as measured by the establishment of a state professional association, significantly increases the probability of regulation. Together, our findings suggest that both public and private interests have contributed to the diffusion of licensing requirements across states and occupations.
Historical Data on Occupational Regulation in the United States
Download paper (updated January 2025); Data repository (partial sample)
This paper describes the construction and validation of a novel dataset that compiles over one hundred and fifty years of occupational licensing, certification, and registration requirements in all fifty states and the District of Columbia. It identifies the enactment and effective dates of state and federal policy changes for more than 300 distinct occupations that cover the vast majority of regulated jobs in the United States. Relative to existing data on occupational licensing and regulation, my dataset is more comprehensive, reduces measurement error in enactment dates, and offers an internally-consistent taxonomy of regulatory methods. Linking my policy data to independent measures of occupational licensing and certification from recent household survey data and the text of online job postings, I show that state-level policy differences have an economically significant effect on the credentials workers hold and employers require. I discuss the interpretation of estimates based on these measures and conclude with recommendations and directions for future research.
The Impact of Occupational Licensing on Earnings and Employment: Evidence from State-Level Policy Changes
Download paper (updated November 2020)
This paper studies the short- and long-run impact of occupational licensing on labor market outcomes in the United States. I compile new data from contemporary and historical legislative documentation that records all state-level policy changes for over 200 licensed occupations. Using this data, I implement an event study design that exploits within-occupation variation in the timing of licensing statutes across states to trace out the dynamic response of earnings and employment to policy changes. I find consistent evidence across several independent employer and household surveys that the typical licensing statute adopted during the past half-century increased worker earnings, but had null or weakly positive effects on employment. Twenty-five years after licensing statutes were adopted, cumulative wage growth in treated state-occupation cells exceeded that of untreated controls by 4 to 7%. Over the same time period, my results rule out an average disemployment effect greater than -5%. The data show much larger decreases in employment, however, among occupations that have little potential to cause serious harm. In cases where the consumer protection rationale for licensing is more plausible, I find simultaneous increases in both earnings and employment following the adoption of licensing requirements.
Other work in progress
New Work in the Second Industrial Revolution (with Jingyi Huang and Elior Cohen)
This paper introduces a new measure of emerging occupations in the late 19th and early 20th century United States. Rapid technological and procedural innovation dramatically altered the task content of production, leading to the emergence and diffusion of entirely new work activities and occupations. We use the original write-in occupation responses recorded on Census enumeration forms between 1850 and 1940 to identify specific, granular, job titles such as “comptometer operator” at the individual level and track their growth over time. Using this data, we first document a set of novel facts about new jobs during the Second Industrial Revolution including the locations where they first appeared, how quickly they diffused across local labor markets and industries, and the demographic characteristics of the workers who held them. Next, we match job titles observed in the Census to textual descriptions of their tasks and tools derived from the first edition of the Dictionary of Occupational Titles. We link these job descriptions to a comprehensive corpus of U.S. patent texts to study the relationship between the adoption of new production methods, the skill content of new work, and local labor market power.
