Quality and selection in regulated professions

Abstract

Entry into many occupations is regulated to screen out the least able candidates, but available evidence suggests that this objective is rarely achieved. Using microdata covering the universe of Italian law school graduates (2007-2013), we show that this result is largely due to the strong intergenerational transmission of occupations within regulated professions. We find that having relatives already active as lawyers significantly increases the probability of passing the entry exam and boosts earnings, particularly for those who performed poorly in law school.