Job Market Signaling through Occupational Licensing

Peter Blair and Bobby (Wing Yin) Chung

No 24791, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Among men, the black-white wage gap is as large today as it was in 1950. We test whether the black-white wage gap is due to asymmetric information using newly collected data on occupational licensing laws that ban workers with criminal records. We find evidence supporting this hypothesis. The licensing premiums for black men are largest in licensed occupations that restrict felons —particularly in states with Banthe-Box laws and at small firms. In these contexts where a worker’s criminal history is difficult to infer, we find that occupational licensing reduces asymmetric information and reduces the racial wage gap.

JEL-codes: D21 D82 D86 J24 J31 J70 K23 K31 L51 (search for similar items in EconPapers)
Date: 2018-07
New Economics Papers: this item is included in nep-hrm, nep-law and nep-lma
Note: DAE ED IO LE LS
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Citations: View citations in EconPapers (24)

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Working Paper: Job Market Signaling through Occupational Licensing (2017)
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