Who should be allowed to brighten your teeth?

We are talking about lowly teeth whitening, not something serious such as root canals, but the underlying principles are serious enough that the U.S Supreme Court is interested in answering this question. In particular, the Court has agreed to consider (February 2016) a case in which a Connecticut law prevents non-dentists in salons in Connecticut from providing teeth whitening service.

Under Connecticut law, it is legal for salons run by non-dentists to offer teeth-whitening services, to make low-powered teeth-whitening lights available for use in their shops, and to supervise and instruct customers on the use of those lights. But any non-dentist who physically positions a teeth-whitening light in front of his customer’s mouth is guilty of the felony of the unlicensed practice of dentistry and may be sentenced to up to five years in jail or fined $25,000 per customer.

In other words, it is legal for only dentists, not salons, to actually perform teeth whitening in Connecticut.

Economic theory suggests that, as a rule, governments should let firms enter any business they want to; there should be few “barriers to entry.” However, it is common to see various groups trying to prevent entry to protect their own turf. For example, Uber and Lyft’s entry has been resisted by conventional taxi operators and taxi regulators.

In this case, a group of economists have filed an amici curiae brief that states, in part:

Among economists, there would be virtually no dispute about the proper interpretation of the record in the case below: The sole purpose and effect of the Connecticut State Dental Commission’s declaratory ruling (the “Ruling”) is to benefit the economic interests of Connecticut dentists by excluding lower-cost competitors from the teeth-whitening marketplace. Indeed, the Ruling is a paradigmatic example of a “rent-seeking” regulation designed to transfer wealth from consumers to a particular interest group.

In other words, by making it illegal for lower-cost salons to offer teeth-whitening service, the Connecticut law makes it easier for dentists to charge high prices for teeth whitening.

The law does not make economic sense, and I hope the Supreme Court will overturn it.