Economic Analysis
In regions like the United States of America, the federal, state, and local governments typically play a critical role in controlling business operations. In this light, these governments assert that regulations foster balance within the economy/market in the quest to prevent a few individuals from exploiting the majority (Chowdhury, Audretsch & Belitski, 2019). While varying business regulations in the nation’s history have proved pivotal in encouraging effective business operations, some demonstrate adverse effects like inequality, which consequently overstep Biblical principles. One such regulation revolves around licensing. Therefore, this essay explores how licensing violates Biblical principles while fostering inequality.
The Licensing Legislature
Notably, approximately one-third of Americans oblige government permissions through licensing to operate businesses. Most of these individuals typically earn below-average wages/incomes despite the jobs and businesses being critical to their upward mobility and self-sufficiency. However, the onerous licensing legislation tends to stand in the way of these individuals. Licenses are essentially designed to curb poor-quality services and, at the same time to foster public safety. Conversely, evidence depicts that most business people and the public do not reap such benefits. For instance, occupational licensing raises the costs of services and goods, and therefore, it negatively impacts individuals that strive to get meaningful employment. Moreover, licensing places barriers to entry-level jobs that would get performed by those with limited training, like interior designers, pest control applicators, truck drivers, and even cosmetologists (Gittleman, Klee & Kleiner, 2018). In most cases, the licenses pose experience or education prerequisites, hurting most individuals. An epitome is that some states oblige cosmetologists to have approximately 372 days of formal training to get a license to style hair. Other states oblige interior designers to get licensing before they are allowed to practice within the state.
The licensing requirements tend to overstep their mandate and follow the fallacy that government spending and, consequently, taxation are the panacea of all economic and economic ills/inequality. In this regard, Hazlitt (2010) asserts that the globe is full of ‘economists’ who craft schemes for getting something, such as licensure levies, for nothing. This is even though individual success in most occupations or businesses gets significantly linked to customer satisfaction based on personal expertise attained through practice and experience. The licensing law, therefore, oversteps its mandate through the licensing legislature as it affects individuals that should not be impacted. The law ends up limiting young entrepreneurs’ opportunities, consequently fostering disparity and poverty. Moreover, the licensure obligations end up raising costs for the consumers. Given that most licensed individuals offer services and products bought by the low-income cohort, the licensing hits them twice; it limits job opportunities and fosters higher prices. Such hurts the economy and society as a whole negatively.
According to Proverbs 22:7, the rich tends to rule over the poor, and the borrower becomes the slave of the lender. The licensing legislation in this line makes the governments play the role of a master who enslaves people with low incomes for personal gains. It is unbiblical and unethical as it limits the survival of entrepreneurs and their businesses. Nevertheless, Hazlitt (2010) asserts that it is improbable that the wealth that gets fostered by government expenditure compensates for the wealth destroyed through the taxes imposed, for instance, through licensure. It discourages innovation and the start of new businesses (Chowdhury, Audretsch & Belitski, 2019). The implication is that the government spenders or policies create issues like unemployment which they profess to solve.
In conclusion, the licensing legislature in regions like America may be designed to protect citizens by ensuring that businesses or entrepreneurs offer quality services and products. However, it tends to emerge as a double-edged sword and oversteps biblical principles as it does not apply in all fields. In most cases where professionalism is defined by individual expertise or skills, marginalized entrepreneurs are limited by negatively impacting their economic welfare. Besides, the laws typically redistribute wealth from the people that cannot afford the licensure costs. Overall, nations with numerous regulatory restrictions witness significant levels of income inequality.
References
Chowdhury, F., Audretsch, D. B., & Belitski, M. (2019). Institutions and entrepreneurship quality. Entrepreneurship Theory and Practice, 43(1), 51-81. https://journals.sagepub.com/doi/pdf/10.1177/1042258718780431
Gittleman, M., Klee, M. A., & Kleiner, M. M. (2018). Analyzing the labor market outcomes of occupational licensing. Industrial Relations: A Journal of Economy and Society, 57(1), 57-100. https://www.nber.org/system/files/working_papers/w20961/w20961.pdf
Hazlitt, H. (2010). Economics in one lesson: The shortest and surest way to understand basic economics. Currency.
write