The Foundry

The left is in full attack mode against Joe the Plumber. The leftist website Daily Kos has even posted his home address (and, mistakenly, even the home address of his ex-wife). Now the plumber’s union in Toledo, Ohio, is moving to put him out of business. Joe’s crime? He doesn’t like Barak Obama’s redistributionist tax policy and he does not have an official state plumbing license.

The Toledo Blade reports that even though Joe’s employer has a state plumbing license and one with the City of Toledo, it is illegal for Joe to do plumbing work. Even Joe’s employer, despite holding state and city licenses, can’t do plumbing work in the surrounding county because they do not have the right county plumbing license.

Do all these license requirements help anybody? Yes they do. But the people they help are not consumers. The New York Times reports:

The usual rationale for occupational licensing is that it helps protect the public from unqualified providers. … Several studies have examined the effect of license requirements on performance in occupations like dentists and teachers. In one study, Professor Kleiner and a colleague, Robert T. Kudrle, found that stricter state licensing requirements for dentists did not noticeably affect the dental health of 464 Air Force recruits. Other studies have found at best weak evidence that students in classes taught by licensed teachers performed better than those taught by unlicensed teachers. Summarizing the literature, Professor Kleiner concludes, “there is little to show that occupational regulation has a major effect on the quality of service received by consumers.”

Accounting professor David Young also summarizes the economic literature on the subject:

The argument in favor of licensing always has been that it protects the public from incompetents, charlatans, and quacks. The main effect, however, is simply to restrict entry and reduce competition in the licensed occupation.
…
A careful analysis of licensing’s effects across a broad range of occupations reveals some striking, and strikingly negative, similarities. Occupational regulation has limited consumer choice, raised consumer costs, increased practitioner income, limited practitioner mobility, and deprived the poor of adequate services—all without demonstrated improvements in the quality or safety of the licensed activities.