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Licensing Doctors: Do Economists Agree?

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  • Shirley Svorny

Abstract

Despite the wide reach of medical licensing in health care production through its impact on the nature and cost of care, it has been all but ignored in debates over health care reform. This paper pulls together statements made by economists whose expertise is in the area of health economics or, more specifically, medical licensure and discipline. Economists who have examined the market for physician services in the United States generally view state licensing as a means by which to enforce cartel-like restrictions on entry that benefit physicians at the expense of consumers. Medical licensing is seen as a constraint on the efficient combination of inputs, a drag on innovations in health care and medical education, and a significant barrier to effective, cost efficient health care.

Suggested Citation

  • Shirley Svorny, 2004. "Licensing Doctors: Do Economists Agree?," Econ Journal Watch, Econ Journal Watch, vol. 1(2), pages 279-305, August.
    • Handle: RePEc:ejw:journl:v:1:y:2004:i:2:p:279-305
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    References listed on IDEAS

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    1. Leffler, Keith B, 1978. "Physician Licensure: Competition and Monopoly in American Medicine," Journal of Law and Economics, University of Chicago Press, vol. 21(1), pages 165-186, April.
    2. Cotton M. Lindsay, 1973. "Real Returns to Medical Education," Journal of Human Resources, University of Wisconsin Press, vol. 8(3), pages 331-348.
    3. William White, 1987. "The introduction of professional regulation and labor market conditions," Policy Sciences, Springer;Society of Policy Sciences, vol. 20(1), pages 27-51, April.
    4. Svorny, Shirley V, 1987. "Physician Licensure: A New Approach to Examining the Role of Professional Interests," Economic Inquiry, Western Economic Association International, vol. 25(3), pages 497-509, July.
    5. Mark Pauly, 1980. "Doctors and Their Workshops: Economic Models of Physician Behavior," NBER Books, National Bureau of Economic Research, Inc, number paul80-1.
    6. Burstein, Philip L. & Cromwell, Jerry, 1985. "Relative incomes and rates of return for U.S. physicians," Journal of Health Economics, Elsevier, vol. 4(1), pages 63-78, March.
    7. Leland, Hayne E, 1979. "Quacks, Lemons, and Licensing: A Theory of Minimum Quality Standards," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1328-1346, December.
    8. Simon Rottenberg, 1980. "Occupational Licensure and Regulation," Books, American Enterprise Institute, number 968900, September.
    9. Anderson, Gary M. & Halcoussis, Dennis & Johnston, Linda & Lowenberg, Anton D., 2000. "Regulatory barriers to entry in the healthcare industry: the case of alternative medicine," The Quarterly Review of Economics and Finance, Elsevier, vol. 40(4), pages 485-502.
    10. Adriana D. Kugler & Robert M. Sauer, 2005. "Doctors without Borders? Relicensing Requirements and Negative Selection in the Market for Physicians," Journal of Labor Economics, University of Chicago Press, vol. 23(3), pages 437-466, July.
    11. Svorny, Shirley & Toma, Eugenia Froedge, 1998. "Entry Barriers and Medical Board Funding Autonomy," Public Choice, Springer, vol. 97(1-2), pages 93-106, October.
    12. A. Frank Adams III & Robert B. Ekelund Jr. & John D. Jackson, 2003. "Occupational Licensing of a Credence Good: The Regulation of Midwifery," Southern Economic Journal, John Wiley & Sons, vol. 69(3), pages 659-675, January.
    13. Noether, Monica, 1986. "The Effect of Government Policy Changes on the Supply of Physicians: Expansion of a Competitive Fringe," Journal of Law and Economics, University of Chicago Press, vol. 29(2), pages 231-262, October.
    14. Carl Shapiro, 1986. "Investment, Moral Hazard, and Occupational Licensing," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 53(5), pages 843-862.
    15. Seldon, Barry J. & Jung, Chulho & Cavazos, Roberto J., 1998. "Market power among physicians in the U.S., 1983-1991," The Quarterly Review of Economics and Finance, Elsevier, vol. 38(4), pages 799-824.
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    Cited by:

    1. Blair Jenkins, 2009. "Rent Control: Do Economists Agree?," Econ Journal Watch, Econ Journal Watch, vol. 6(1), pages 73-112, January.
    2. Daniel B. Klein & Charlotta Stern, 2007. "Is There a Free‐Market Economist in the House? The Policy Views of American Economic Association Members," American Journal of Economics and Sociology, Wiley Blackwell, vol. 66(2), pages 309-334, April.
    3. Daniel J. Smith & Noah J. Trudeau, 2019. "The Undertaker’s Cut: Challenging the Rational Basis for Casket Licensure," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 34(Summer 20), pages 23-41.
    4. Roman V. Galperin, 2020. "Organizational Powers: Contested Innovation and Loss of Professional Jurisdiction in the Case of Retail Medicine," Organization Science, INFORMS, vol. 31(2), pages 508-534, March.
    5. Clara Ponsati & Jozsef Sakovics, 2005. "Markets for professional services: queues and mediocrity," Edinburgh School of Economics Discussion Paper Series 133, Edinburgh School of Economics, University of Edinburgh.
    6. Jon Diesel, 2010. "Do Economists Reach a Conclusion on Organ Liberalization?," Econ Journal Watch, Econ Journal Watch, vol. 7(3), pages 320-336, September.
    7. Dacuycuy, Lawrence B., 2008. "The migration of health professionals," ILO Working Papers 994112253402676, International Labour Organization.
    8. Daniel B. Klein & Benjamin Powell & Evgeny S. Vorotnikov, 2012. "Was Occupational Licensing Good for Minorities? A Critique of Marc Law and Mindy Marks," Econ Journal Watch, Econ Journal Watch, vol. 9(3), pages 210-233, September.

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    More about this item

    Keywords

    Physician Licensing; Medical Licensure; Regulation; Medical Licensing;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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