(individual) An advocate of state regulation of cosmetologists and barbers argued that the state cosmetology agency had taken in $756,805 in revenue in the preceding year while spending only $589,014, thus providing a net benefit to the state. Where would you look to locate some additional costs created by the agency?
Licensing cosmetologists likely reduces the supply of hairstylists. This will increase the cost to consumers. The law of demand says that they will purchase fewer hairstyling services. This will reduce tax revenue for the state government.