Microeconomics: Theory and Applications with Calculus, 4e

9 Properties and Applications of the Competitive Model

No more good must be attempted than the public can bear.

—Thomas Jefferson

CHALLENGE Liquor Licenses

Do you want to open a restaurant that serves drinks when you graduate? If so, you’ll need a liquor license, which, in some states, costs a lot of money.

Seventeen states and Washington, D.C., limit the number of liquor licenses.1 Massachusetts issues one license per 2,000 residents; New Jersey, one per 3,000; and Utah, one per 4,925. In these limit or quota states, buying a liquor license from the state only costs a few hundred dollars. However, you probably can’t get one from the state. You’ll ...