It is accepted by almost everyone that the licensing of doctors and other professionals by governments is necessary. Without getting into a long argument for or against professional licenses, I want to get you thinking abut this.

We should note that a license given by a government only requires a minimum standard that is primarily measured in terms of education and training, not performance. While the stated purpose is public safety, the practice of licensing leads the public to be complacent. In fact, people are complacent to the point where most will spend twice as much time researching which computer to buy than researching which doctors or lawyers or financial planners to use.

The premise that licensing encourages is that all who have a license are roughly equal in ability. This is clearly not true, and nobody would even claim it to be, but people do act as though this is the case. In addition to the complacency that results from licensing, it also discourages pay based on performance. It would make sense that among surgeons in the same hospital, those who kill twice as many patients as others should offer a discount, but once licensing becomes the norm, measuring and making public such performance statistics is less common.

It’s assumed that if licensing did not exist that we would all be at more risk, but this has not been proven in any systematic way. We see a more safety in an industry as licenses become the norm, but usually if you look at the history the standards were rising well before the calls for licensing. Customers can ask for credentials in any case, and it would be fraud to misrepresent ones experience or education, so hiring professionals with just as much training would still be possible. In any case, licenses or cerifications that are not legally required–and which may have higher standards–could be looked for customers. These are common in many industries that do not have legal licensing requirements. Also possible would be the choice to hire a skilled (and cheaper) professional who happened to have fewer degrees but did a good job anyhow. If it it really true that the overall risk is reduced by licensing, it seems there would be studies and evidence to supports this.

Now, here are two questions to get you thinking about the morality of licensing laws and the real intent.

1. If my friend wants me to sell his house for him, knowing I have no real estate license, and I am willing to do it, is it actually right to send me to jail for such a “crime?” What is the specific thing I did that is wrong?

2. What real purpose does the licensing of “low risk” professions serve, such as licenses for hair cutters and interior designers? What constituency do you think originally pushed for such laws?