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Business Licensing in Europe

August 30, 2015, 1:52 pm

We had a private tour in Vienna from a very good tour guide.  Apparently, to become a tour guide in Austria requires that one study for years and take a special government test to get a government license.  It does not matter if one wants to just focus on, say, giving special Klimt-only tours at the Belvedere or if one wants to give comprehensive cross-city tours, one still must pass the same test to practice tour-guiding.  This, by the way, is entirely parallel to how most US states require one to get a full dental license after a bajillion years of school whether one wants to repair cavities or just whiten teeth.

As a result, tour guides seem to get 80 Euros an hour and up.

Anyway, as we walked we were chatting with her as she called a cab.  We asked if they had Uber in Vienna, suspecting that they had the same conflicts with it as in, say, Paris.  But she had never heard of it, so we explained the concept to her.

To her credit, she immediately got it, so much so that she immediately thought about it in the context of her job.  She said, "Can you imagine, if any housewife could give tours and charge 30% (of her rate)?  I would be looking for work the next day."

I am not totally sure that is true -- there is more differentiation in quality of tour guides vs. cab drivers.  But she recognized that a portion of what she earned came because the license she had gotten from the government excluded a lot of potential competition.

Tags: , ,
Category: Economics

8 Comments

  1. slocum:

    Not just Europe. Until it was thrown out in court last year, Washington DC had the same kind of tour guide license:

    http://www.washingtonpost.com/local/crime/dc-tour-guides-win-challenge-of-licensing-test/2014/06/27/a5e7fd82-fe13-11e3-8176-f2c941cf35f1_story.html

    But the system still exists in New Orleans:

    http://www.nola.gov/onestop/business/taxi/tour-guide-permit/

    August 31, 2015, 4:30 am

  2. kidmugsy:

    And there you have a neat summary of why so many Britons have an instinctive aversion to the EU.

    August 31, 2015, 5:34 am

  3. sch:

    And recall the foorah in Charleston where rickshaw drivers were severely disciplined (ie arrested) if they pointed out interesting sites to any of their passengers, as that trespassed into the licensed tour guide territory.

    August 31, 2015, 6:10 am

  5. John O.:

    These kind of dumb licensing schemes exist all over the place, its not just tour guides, its also dumb things like only a funeral director has the right to sell caskets. A little heard case in Louisiana was taken up by the Institute for Justice when a Abbey in Northwestern Louisiana was ordered by the state board of funeral directors to cease selling hand made oak caskets which they sold direct to the public to fund their monastery. After several rounds of trial and appeals, the 5th Circuit Court of Appeals upheld the right of the Abbey to make and sell caskets directly and invalidated the Louisiana law protecting funeral directors from competition. Another case IJ took up in Louisiana was the obnoxious florist exam that was required to be taken by anybody wishing to practice floral arrangements. The state's board of florists enforced the law and it was given considerable attention by John Stossel in 2009-2010.

    August 31, 2015, 10:17 pm

  6. Craig Loehle:

    "State board of florists" really? What a waste of tax money.
    It is interesting that some of the biggest jobs in the country: CEO, business owner, politician don't need any degrees, certificates, or licenses but you do to arrange flowers or braid hair.

    September 1, 2015, 6:34 am

  7. Earl Wertheimer:

    Another reason why it's so difficult to reduce government and regulation. The owners with taxi medallions that were previously worth hundreds of thousands, now want to be compensated for the loss of value.
    ..or demand that the upstarts (like Uber) go through the same B.S. that they were forced to follow.

    September 1, 2015, 10:15 am

  8. marque2:

    Oh, you don't want shoddy funeral services
    https://www.youtube.com/watch?v=YKqsqxM_U90

    September 1, 2015, 12:13 pm