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In: Economics

1) Government regulation like licensing requirements create barriers to entry prevents new firms from developing and...

1) Government regulation like licensing requirements create barriers to entry prevents new firms from developing and marketing products and services. This is done presumably to ensure high standards for those industries that require licenses. However, often times it can create a dearth of individuals allowed to do the job. How stringent should licensing requirements be for the following groups:

  1. Physicians
  2. Attorneys
  3. Teachers
  4. Accountants
  5. Architects
  6. Taxi drivers

Discuss this with regard to market entry and exit, market power like monopolies and oligopolies, as well as with regard to complaints that licensing requirements often do not match the monetary gains of certain professions.  

2) Think of an industry that has only a small handful of competitors in the market. How do these types of organizations maintain market dominance?  What risks do the individual firms in your chosen industry take in an oligopoly dominated industry?

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Expert Solution

Rahul Sunny answered 2 years ago
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