Lessons from an Unlicensed Barber

Center for American Progress house blogger Matthew Yglesias confesses that he has an unlicensed barber, and has no regrets.

Regulation of this sort seems totally unnecessary. People don’t die of bad haircuts, and since hairstyle is a quintessential matter of taste there’s absolutely no reason to think consumers can’t figure out for themselves who has a decent reputation as a cutter of hair. You can cut your own hair perfectly safely in your own house, and if you screw it up all that happens is you need to find a real professional to fix it. But what’s more, even if regulation were somehow a good idea, the composition of the board couldn’t possibly serve a legitimate consumer protection function. It’s overwhelmingly composed of people from the industry whose incentive is to limit competition and raise prices.

But barbers are licensed and heavily regulated in much of the country nonetheless.  What could justify this?  Sraight razors perhaps?  No dice, says Yglesias.

though “torts and the free market will take care of it” isn’t the answer to everything, it’s surely the answer to some things. Getting some kind of training before you shave a dude with a straight razor is obviously desirable in terms of strict self-interest. If you screw it up in a serious way, you’ll face serious personal consequences and the only way to make money doing it—and we’re talking about a very modest sum of money—is to do it properly. People also ought to try to think twice about whether their views are being driven by pure status quo bias. Barbers are totally unregulated in the United Kingdom, is there some social crisis resulting from this? Barber regulations differ from state to state, are the stricter states experiencing some kind of important public health gains?

The government licensing and regulation of barbers, like other hair stylists, is driven by the self-interest of the profession.  Licenses restrict entry and reduce  competition, enabling  those with licenses to capture more rents.  This is actually the case with most licensing regimes, even those that appear to serve a greater public interest than barber licenses.  Though I doubt Yglesias would go this far, I would argue that it’s rare that a licensing regime of this sort is put in place without the support of those who stand to benefit economically, and that many public spirited rationales, including health and safety, are a smokescreen.

It’s also important to remember that the creation of a licensing, permitting and inspection, or other regulatory regime hardly guarantees protection of the public interest, even if the system was not created for rent-seeking purposes in the first place.  Government regulators and inspectors are people too, and may shirk their responsibilities, become corrupted, or otherwise fail to safeguard the public interest.  In many major cities, licensing and other local regulatory regimes are opportunities for corruption and graft.  We have our share in Cleveland, but we’re not alone.  A friend of mine in D.C. was shaken down during the health inspection for her  bar in our nation’s Capitol, and check out this story about one building inspector in New York who submitted hundreds of fraudulent inspection reports.

Ygelsias is correct that barber licensing is completely unnecessary, but it’s just the tip of the iceberg.  I am not prepared to say that all such regulatory regimes are unnecessary or unwise, but as a former colleague of mine would say, this is an area in which one could swing an axe for days and never hit live wood.