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Stephen Bazen, Monopsony in Motion: Imperfect Competition in Labor Markets, The Economic Journal, Volume 114, Issue 493, February 2004, Pages F159–F161, https://doi.org/10.1111/j.0013-0133.2004.191_10.x
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Extract
In the 1990s, empirical studies into the effects of policy‐induced wage increases such as minimum wages and equal pay showed that such measures had a noticeable effect on the earnings structure but apparently no adverse effect on the employment of the workers concerned. These conclusions, which are clearly at odds with the view that firms are price‐takers in the labour market, have led to renewed interest in the possibility of monopsonistic behaviour. Alan Manning’s timely book is a self‐contained, wide‐ranging treatment of some of the key issues in labour economics from a monopsonistic point of view.
Monopsony is often taught as a limiting case but it is seen as having little relevance to modern labour markets since the case of only one buyer of labour is extremely rare. However, the author emphasises that what is important is the idea that employers have power in the labour market, so that monopsonistic competition or oligopsony would be more appropriate terms.
