Saturday, September 17, 2016

Rent-seeking in Kentucky

In the Kentucky hair-braiding market, there wasn't quite an alliance between Baptists and bootleggers like Professor Elzinga observed in Albemarle Country years ago, but it was similar to the current liquor market in Texas. This ended over the summer, when Kentucky Governor Matt Bevin signed a bill exempting natural hair-braiders from burdensome occupational license regulations. The regulations in Kentucky restricted the entrance of new firms into the market by requiring all hair-braiders take 1,800 hours of irrelevant training to obtain a cosmetology license and legally open a business. This could cost up to $20,000. These regulations didn't serve any rational basis. The natural hair-braiders are primarily West African immigrants who learned this trade from their family members, and according to the Institute of Justice's report (and, presumably, common sense), the hair-braiding profession is perfectly safe. In other words, society's health, safety and morals weren't served by the regulations, but the pockets of some well-connected cosmetologists probably were. This explains why State Representative Hubert Collins -- "whose wife chairs the Kentucky Board of Hairdressers and Cosmetologists" -- attempted to introduce an amendment barring natural hair-braiders from working legally unless they jumped through all of the Board of Hairdressers' hoops. Similar to the five families in Texas using the force of law to keep out competitors in the liquor market, entrenched interests in Kentucky tried to lobby the state government to erect artificial barriers to entry in the cosmetology market. Fortunately their efforts were defeated, so now these people can make an honest living:
 


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