Trade licensing
From Free Talk Live
The term trade licensing refers to the fact that you must purchase a license, which typically means attending so many hours of classes (which you must of course pay for).
- "Licensing does absolutely zero to protect you from shoddy workmanship, but what it does do is it protects the existing businesses from new competition." - Ian, FTL 2006-03-18
- "You're not free if you have to ask permission to go into your business." - Ian, FTL 2006-03-18
Contents |
Good intentions
Licenses are meant to inform consumers that certain businesses are legitimate, to ensure that the particular business has gone through the minimum amount of training and will provide "safe" and "high quality" services or products.
Unforeseen consequences
Licenses are a Barrier to Entry, increasing the cost and effort it takes to begin a business. The hosts have said this is not an Unforeseen Consequence, and is in fact the primary purpose of Trade Licensing, created by existing businesses to restrict new competition from entering the market.
Examples
African Hair Braiding
A 15 year old girl runs her own business by braiding hair. When a local newspaper runs a story on her, the publicity gets her the attention of the State Board of Cosmetology, who inform her that it is illegal to braid hair without a proper license. They then fined her and shut down her business. To earn a license, she must attend a cosmetology course, which requires hundreds of hours and is not free of cost. The cosmetology course covers everything from nail care to hair cuts, but ironically, absolutely nothing about african hair braiding. This specific incident was discussed on episode FTL 2006-03-18.
