The Economic Impact of Professional Services Liberalisation

Erik Canton, Daria Ciriaci and Irune Solera

No 533, European Economy - Economic Papers 2008 - 2015 from Directorate General Economic and Financial Affairs (DG ECFIN), European Commission

Abstract: Competition in professional services is, in some occasions, hindered by excessive regulation. This may constrain business dynamics (entry and exit of firms) and create inefficiencies and excessive rents. To improve market performance in those professional services generally regulated, several EU countries have reduced regulatory restrictions regarding the entry into and exercise of these professions. This study is an attempt to evaluate the effects of regulatory barriers in four of them, i.e. legal, accounting, architectural and engineering activities in the EU over the period 2008-2011. It is found that less strict regulation improves their allocative efficiency and reduces the observed larger-than-average profitability, through intensified business dynamics.

JEL-codes: D21 D22 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2014-09
New Economics Papers: this item is included in nep-bec, nep-eur and nep-reg
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:euf:ecopap:0533

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