The Rise and Impact of Nurse Practitioners and Physician Assistants on Their Own and Cross‐occupation Incomes

There has been a dramatic increase in the authority granted to nurse practitioners (NP) and physician assistants (PA). This “expanded” authority has changed who can provide health‐care services and has weakened the control physicians have traditionally held over the provision of medical services. These changes in regulation have varied by occupation, state, and year and provide variation that can be exploited to empirically measure the individual and collective impacts of changes in NP authority and PA authority on practitioner incomes. It is found that changes in NP and PA regulatory authority do impact the labor markets of all three practitioner categories. NPs having greater practice authority brings physician incomes down, has differential impacts on PA incomes, and improves their own earnings, other factors held constant. PAs having increased authority has a downward effect on NP earnings, a positive impact on physician income, and little impact on their own incomes. ( JEL I18, J18, J44, H75)