Passing the NY bar exam obviously lets you practice in NY. However, I have heard that some states will let you practice there if you have passed certain other states bar exams. So passing the CA bar exam lets you practice in more states than just California. Does anyone know of a website that explains this?
Not the answer you were looking for, but I believe a recent LA Times article noted that some states that normally allow reciprocity with other states in recognizing bar admissions deny that to California lawyers. There's an accusation that the modified bar exam California requires lawyers from other states to take amounts to putting up a high-wire fence around the state's lucrative legal market, and other states are striking back in turn.
The California Bar does not have reciprocity with any other states. Thus, to practice in CA requires passing the CA bar and jumping this hurdle only allows you to practice in CA. As Jeff mentioned, CA wants to keep out the riff-raff so CA attorneys can justify our high fees. While only a young associate at Wilson Sonsini Goodrich & Rosati (large CA firm), I was billed out to clients at $275 an hour. Partners commanded $450 an hour.
Note that CA and NY have by far the hardest bar exams.
Wisconsin is the only state that does not require a bar exam, but only if you graduated from a law school in Wisconsin. Almost enough of a perk to brave those cold winters.