There are alternatives to licensure. For example, some of the “signaling” benefits associated with licensing30 can be realized without the government restricting entry into occupations. Voluntary certification through professional associations can benefit practitioners by enabling them to distinguish themselves, while consumers remain free to choose among all providers and decide for themselves how much value to place on such credentials.
An example is ASE certification for auto mechanics through the National Institute for Automotive Service Excellence. Presently, about 350,000 mechanics hold ASE certifications, and it is a credential widely recognized and valued in the industry. ASE-certified professionals usually wear ASE insignia and carry credentials listing their exact areas of expertise, while employers display their technicians’ credentials in customer waiting areas.31
There are also third-party consumer organizations, such as the Better Business Bureau, and more contemporary versions built on new information and communication technologies, such as Angie’s List (www.angieslist.com), that enable consumers to hold occupational practitioners accountable for the quality of their goods and services. These organizations already help consumers sort through providers in fields where practitioners are licensed and in those where they are not. In addition, consumer affairs divisions within various state governments provide aggrieved parties an option with even greater authority.
30 Spence, M. (1973). Job market signaling. Quarterly Journal of Economics, 87(3), 355-374.