monopsony

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Monopsony

The existence of only one buyer in a market, forcing sellers to accept a lower price than the socially optimal price.

Monopsony

Describing a market for a good or service with several potential sellers and only one potential buyer. Low prices mark the monopsonies because the sellers must compete for the buyer, perhaps to below sustainable level. One may thing of a monopsony as the polar opposite of a monopoly. See also: Buyer's Market.

monopsony

Of, relating to, or being a market in which there is a single buyer of a particular good or service. Businesses selling in a market characterized by monopsony are likely to suffer below-average profitability because of the lack of alternative outlets for their products. Compare monopoly.

monopsony

a form of BUYER CONCENTRATION, that is, a MARKET situation in which a single buyer confronts many small suppliers. Monopsonists are often able to secure advantageous terms from suppliers in the form of BULK-BUYING price discounts and extended CREDIT terms. See MONOPOLY, BILATERAL MONOPOLY.
References in periodicals archive ?
The profit function of the monopsonistic entrepreneur is then given by
Using data on average salaries in Kentucky for the 1989 1990 school year and a variety of specifications, Borland and Howsen (1992, 1993, 1996) estimate that the difference in average salaries between perfectly competitive and perfectly monopsonistic markets was less than $700 per year.
The article is presented as follows: a review of monopsonistic exploitation, followed by a discussion of antitrust damages, an empirical example in Major League Baseball, the problem with damage estimation, and then some concluding remarks.
The model of monopsonistic discrimination was developed by Robinson (1933) to describe a labor market in which two groups of equally productive workers (men and women) are paid different wages because they differ in their elasticities of labor supply.
Marginal players could not risk the strategy, for fear of not getting their contract renewed with the monopsonistic employer.
The Medicare end-stage renal disease (ESRD) program, as a virtually monopsonistic buyer of ESRD-related services, offers an example of this phenomenon (Farley 1994).
Although Grootaert and Patrinos's discussion of the new strategy for eliminating child labor (Chapter 7) is both thorough and engaging, the underlying assumption that child labor exists due to inadequate educational systems, monopsonistic labor markets, poverty, and "perverse incentives that create a demand for child labor" (p.
The term 'Pigovian exploitation', for example, is utilised to describe an amalgam composed of Pigou's definition of exploitation and Robinson's discussion of the distinction between monopolistic exploitation and monopsonistic exploitation.
It was argued earlier that the monopsonistic equilibrium output, such as [E.
this variation in quality would be supplied by competing educational enterprises, which would break down the oligopsonistic and monopsonistic structures by which teachers' pay has been restrained in the past - though weakened trades unions might offset this.
So one way of testing the implications of the dynamic monopsony model is to see whether the size-wage relationship will be stronger for segments of the labour market which are more monopsonistic.
The fourth factor promoting departures from traditional regulation has been the emergence of large customers seeking to exercise monopsonistic power.