Licensing as a means of business regulation increases information by establishing minimum standards for entrants, provides an easy remedy in cases of fraud, and assures competence when social costs are greater than private costs. At present, all states license certain occupations and professions. A comparison of municipal licensing practices in different states indicates that these practices are not related to historic or socioeconomic characteristics of the states. Licensing practices in Illinois would be improved by clearer wording of state statutes and consistent court decisions. (BH)