Estimating the Returns to Occupational Licensing: Evidence from Regression Discontinuities at the Bar Exam

Omar Bamieh (), Andrea Cintolesi and Mario Pagliero
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Omar Bamieh: Universidad Andres Bello
Andrea Cintolesi: Bank of Italy
Mario Pagliero: Collegio Carlo Alberto

No 18816, IZA Discussion Papers from IZA Network @ LISER

Abstract: We estimate the earnings returns to occupational licensing by exploiting regression discontinuities at the Italian bar exam. Law graduates who became lawyers after barely passing the exam earned 20,000 euros (50%) more per year than they would have in alternative occupations. This premium is not driven by monopoly rents from entry barriers. Instead, it reflects a compensating differential for the greater earnings risk inherent in the legal profession relative to the outside options available to law graduates.

Keywords: labor market regulation; occupational licensing; field of study; lawyers (search for similar items in EconPapers)
JEL-codes: J08 J44 L50 L84 (search for similar items in EconPapers)
Date: 2026-07
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