Antitrust licensing professional

The unit of observation begins in a specific state and then may be observed to exit that state. In this case, the model considers the amount of time that passes before the observation leaves the initial state e. A hazard model approximates the probability of exiting the initial state conditional on having survived in the initial state up to that point.

See Jeffrey M. A fixed-effects model uses binary indicators for the level of repeated observation in the panel in this case, binary indicators for each occupation and time year. Occupational fixed-effects control for unobserved, time-invariant effects of that occupation on the dependent variable.

Year fixed-effects control for temporal effects on the dependent variable that are common across all occupations. See Wooldridge, supra note 25, at —24, A good discussion of the Kaldor—Hicks compensation principle can be found in Richard E. Just et al. For the seminal articles, see generally J. See generally Morris M. S Morris M. A two-stage least squares model 2SLS is a regression model that uses an instrumental variable for an independent variable that is endogenous.

An endogenous variable is one that is correlated with the error term. An instrumental variable is used to deal with this endogeneity. The instrument must be highly correlated with the endogenous regressor, but uncorrelated with the error term i. The researchers estimate the model in two stages: first, run a regression of where the endogenous variable is a function of the instrument and the other covariates and obtain the fitted values of the endogenous variable.

Second, estimate the OLS regression using the fitted values of the endogenous variable—instead of the endogenous variable itself. These seven include: 1 the year in which the licensing law was enacted; 2 the year in which a state licensing board was introduced; 3 the year in which a state licensing exam was required for new medical license applicants; 4 the year in which a two-year pre-medical college requirement was introduced; 5 the year in which the length of the medical degree was required to be at least four years long; 6 the year in which an internship requirement was imposed; and 7 the year in which a basic science requirement was introduced.

Kleiner et al. Research, Working Paper No. Suppose we are considering two goods, X and Y. If the demand for X goes up in response to a price increase for Y, then we say X is a substitute for Y, i. Shihua Pan et al. Nurse Pract. See generally John J. A log-wage equation transforms the dependent variable the wage into the natural logarithm of the wage. This is a common specification in applied work because coefficients have a percentage interpretation.

Wooldridge, supra note 25, at Health Econ. See generally David E. Health Care Fin. The Case of Dentistry , 43 J. A difference-in-difference model tries to imitate an experimental study with quasi-experimental data. The model calculates a treatment effect by comparing the outcomes in one group before and after a policy intervention.

A difference-in-difference-in-difference model adds a third difference into the model as an additional comparison group. See generally Paul Wing et al. Dental Hygiene 1 A three-stage least squares 3SLS model is an extension of the two-stage least squares regression. In this case, both wages and employment are endogenous to each other, and both affect access to care. The model simultaneously estimates supply and demand equations, and the 3SLS model accounts for the correlation in errors across equations.

Correlation indicates that two variables move in the same direction, but does not necessarily imply that one variable causes the other.

This is the distinction between correlation and causation. Frank Adams III et al. Edward J. A wage equation is a mathematical equation where the wage i. OLS regression is a regression method that relates the independent variables and dependent variable in a linear way, and minimizes the sum of the squared vertical distances between the observed data and the predicted observations.

Wooldridge, supra note 25, at 30— See generally Robert J. Andrew Gavil, on behalf of the FTC, also reported that while licensing can protect consumers from harm when used appropriately, it often fails to do so, making consumers worse off without offering quality improvements. Arizona v. Maricopa Cnty. For an economic analysis, see generally Jeffrey L. The Court may have been influenced by Albrecht v. Herald Co. Khan , U. In re Am.

Parker v. Brown, U. The best survey of the state action doctrine can be found in 1A Philip E. Gary S. Becker, Competition and Democracy , 1 J. State Bd. C, WL F. See Friedman, supra note 1, at — This observation was echoed by Stigler, supra note 13, at Presidents Conference v. California Dental Association v.

FTC , also involved a ban on advertising but was not a state action case. See generally Cal. See 17A Ariz. The Court also held that the ban was a violation of the First Amendment and its protection of free speech. We also thank our respective institutions for financial support. Introduction In Capitalism and Freedom , Milton Friedman pointed out that one rationale for restricting the number of physicians involved the preservation of quality.

Political Economy of Occupational Licensing The antitrust laws presume that consumers and society in general are best served when markets are competitive. Boycotts: Theory The fundamental premise of the Sherman Act is that competition promotes consumer welfare and social welfare.

Economic Theory of Boycotts In most of the cases involving practice restrictions, the markets appear to be competitively structured. Figure 1: Competitive Market with No Exclusion The consequences of excluding a source of supply can be illustrated with the supply and demand model.

Summary In summary, the effects of removing a source of supply from a market are higher market prices, lower market output, higher profits for the non-excluded firms, and reduced consumer welfare.

Empirical Evidence on the Effects of Occupational Licensing in Health Professions There has been a good deal of empirical work on occupational licensing within the health care market. General Findings in Occupational Licensing Morris Kleiner and Alan Krueger studied the influence of occupational licensing on the labor market.

Summary The empirical research on the effects of occupational licensing requirements spans many professions, employs different data sources, covers different time periods, and employs econometric techniques of varying sophistication. The State Action Doctrine When state legislatures decide to regulate the professions through licensing, they insulate the group from competition and Sherman Act scrutiny.

One important issue is whether a non-sovereign state actor can claim immunity. Midcal Aluminum, Inc. In FTC v. Phoebe Putney Health Sys. Municipalities, although not sovereign state actors, are subject only to the clear articulation prong.

Before FTC v. North Carolina Dental State Bd. Accordingly, the Supreme Court has devoted considerable thought to crafting its law and doctrine in a way that allows antitrust to remain a key tool in the arsenal for combating abusive occupational restraints. The relevance — and importance — of these doctrines is on display in several key litigations affecting a range of occupations today. Occupational licensing regimes are particularly prone to misuse in innovative markets. When disruptive new entrants threaten to upset the foundational workings of a market with strong incumbents, those incumbents are likely to react by erecting rules and regulations to preserve the status quo.

Numerous examples have made their way into the popular media and the courts , including the troubles companies like Uber and Lyft have had with traditional taxis regimes, and companies like AirBnB have had with hotels. The case of Teladoc Inc. Texas Medical Board 45 presents a particularly germane example of incumbents enacting rules that thwart entry and threaten consumers.

As to state action immunity, both parties stipulated that active supervision was required under NC Dental. This rule would be especially harmful in Texas, which suffers from a staggering shortage of doctors. Texas ranks 41st nationally in physicians per capita, and 47th in primary care physicians per capita. Simultaneously, this case demonstrates how antitrust laws can successfully intervene to protect consumers from such abuses and to halt these harmful effects.

The utility of antitrust — and the commensurate benefits to consumer welfare from antitrust engagement — is on full display here. The antitrust laws played a key role in preventing very harmful effects from being realized in Teladoc , and can do so in many other settings, as well.

As such, we offer some recommendations for directing antitrust engagement below. Occupational licensing reform currently enjoys wide bipartisan support. For example, the FTC has a long history — across Republican and Democratic administrations — of competition advocacy and enforcement actions aimed at state and local restraints on competition. The focus of these advocacy efforts has been to articulate the harm to consumers that can result from actions by public actors that restrict the number of suppliers or raise the cost of entering a particular market.

The report provided evidence that occupational licensing requirements create income inequality — licensed professionals earn more than non-licensed professionals even when controlling for education and other factors. What is more, in the wake of NC Dental , states are looking for guidance. The FTC has a number of tools available to reduce the economic harm caused by occupational licensing and other state restrictions on entry:.

The State and Local Working Group demonstrated human non-economic costs, presenting several stories of ordinary individuals harmed by state licensing laws. In one example, a woman who was a cancer survivor herself built a business that arranged for licensed cosmologists to conduct home visits for cancer patients too sick to travel. However, she was forced to endure sixteen months of litigation when the Arizona Board of Cosmetology required that she be licensed even though she neither cut hair nor operated a salon.

These narratives, and the human costs they illustrate, are an important part of the larger discussion on state licensing regimes. The FTC has a history of investigating and reporting upon the effects of occupational licensing.

See, e. The share of workers licensed at the State level has risen five-fold since the s. Occupational licensure laws raise barriers to entry and prevent many otherwise qualified individuals from entering the trade or profession. Kleiner, Occupational Licensing , 14 J. Declercq et al. Sekscenski et al. In many instances, legislators may well discover that there is little or no substantiation for claims of patient harm. The Case of Dentistry , 43 J. These results hold when examining the effects of occupational regulations such as advertising restrictions.

Bond, J. Kwoka, J. The data are not consistent with the view that advertising and commercial practice lower the quality of professional care available in the market. Kwoka, Jr. In doing so, the Supreme Court rejected state-action immunity for a professional-licensing board dominated by a coalition of private-market participants—dentists—that engage in anticompetitive conduct under the guise of state health, welfare, and safety regulation.

The North Carolina Board of Dental Examiners is a state agency with the authority to oversee the licensure and discipline of dentists and dental hygienists in North Carolina. Like many state professional-licensing boards, it is composed of part-time board members of the regulated profession in private practice. Barrett has the opinion; Gorsuch dissents. The vaccine-policy cases are possible, but we don't know in advance which cases we'll get.

We'll be live-blogging starting at On Thursday, Jan. Sonia Sotomayor continued to participate remotely. And as has been the case all week, Neil Gorsuch was the only justice not wearing a mask.

Here's a view of the bench from Courtartist:. Opinion analysis: No antitrust immunity for professional licensing boards By Eric M. Fraser on Feb 25, at pm. Reply on Twitter Retweet on Twitter 70 Like on Twitter View on Twitter Reply on Twitter Retweet on Twitter Like on Twitter View on Twitter Reply on Twitter Retweet on Twitter 83 Like on Twitter View on Twitter Reply on Twitter Retweet on Twitter 30 Like on Twitter 67 View on Twitter Announcement of opinions for Thursday, Jan.

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