Suppose that the government of the state of New Jersey has find out that a large number of injuries & deaths have taken place as a result of accidents involving the installation & repairs of electrical equipment at private residences. In reaction to this difficulty the state assembly decided to pass a law that made a requirement which all certified electricians take & pass a tougher state licensing examination. Analyze the effect that this law is probable to have on the market for electricians and describe why safety may not necessarily improve.
If the state licensing examination becomes harder it is likely that there will be fewer authorized & certified electricians in New Jersey. Consequently this reduction in supply will lead to higher wages for those who do qualify. However the result may lead more homeowners to carry out electrical work themselves that might wipe out or more than wipe out the positive effect of having more extremely qualified electricians performing work at private residences.