Microeconomics and Licensure

Paper Summary:

This paper presents arguments that rebut the notion that market pricing in the form of licensure negatively interferes with the free market economy. The paper argues that licensure plays an important role in protecting the consumer from faulty, incomplete or incompetent services or products and that the advantages of licensure far outweigh any of its disadvantages.

From the Paper:

"Such perceived interference often results in voting for regulations that monitor sectors of production of goods or services. Once established, some regulations intended to provide a measure of economic justice may tend to lag behind changes in economic events and may hinder or contribute to economic injustice. Also, at times regulatory commissions appointed with the task of providing social values to an otherwise dehumanized system of efficiency often side with the very industry it is supposed to be regulating. The act of granting licenses, for example to practice a profession, is an activity one authority describes as a "Directly Unproductive Profit Seeking Activity" (Maital 288). This same authority feels that licensing mechanisms are incidents where candidates spend heavily to secure them since the control of agencies empowered with licensing mechanisms can be a source of power and profit (288)."

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