How Much of Barrier to Entry is Occupational Licensing? It reduces equilibrium labor supply by an average of 17%-27%

How Much of Barrier to Entry is Occupational Licensing? Peter Q. Blair, Bobby W. Chung. NBER Working Paper No. 25262, November 2018. https://www.nber.org/papers/w25262

Abstract: 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.