Monopsony in Motion: Imperfect Competition in Labor Markets by Alan ManningMonopsony in Motion: Imperfect Competition in Labor Markets by Alan Manning

Monopsony in Motion: Imperfect Competition in Labor Markets

byAlan Manning

Paperback | January 30, 2005

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What happens if an employer cuts wages by one cent? Much of labor economics is built on the assumption that all the workers will quit immediately. Here, Alan Manning mounts a systematic challenge to the standard model of perfect competition. Monopsony in Motion stands apart by analyzing labor markets from the real-world perspective that employers have significant market (or monopsony) power over their workers. Arguing that this power derives from frictions in the labor market that make it time-consuming and costly for workers to change jobs, Manning re-examines much of labor economics based on this alternative and equally plausible assumption.

The book addresses the theoretical implications of monopsony and presents a wealth of empirical evidence. Our understanding of the distribution of wages, unemployment, and human capital can all be improved by recognizing that employers have some monopsony power over their workers. Also considered are policy issues including the minimum wage, equal pay legislation, and caps on working hours. In a monopsonistic labor market, concludes Manning, the "free" market can no longer be sustained as an ideal and labor economists need to be more open-minded in their evaluation of labor market policies. Monopsony in Motion will represent for some a new fundamental text in the advanced study of labor economics, and for others, an invaluable alternative perspective that henceforth must be taken into account in any serious consideration of the subject.

Alan Manning is Professor of Economics and Director of the Labour Markets Programme in the Centre for Economic Performance at the London School of Economics. He has published numerous papers on labor economics.
Title:Monopsony in Motion: Imperfect Competition in Labor MarketsFormat:PaperbackDimensions:416 pagesPublished:January 30, 2005Publisher:Princeton University PressLanguage:English

The following ISBNs are associated with this title:

ISBN - 10:0691123284

ISBN - 13:9780691123288


Table of Contents

  • FrontMatter,pg. i
  • Contents,pg. vii
  • Preface,pg. xi
  • 1. Introduction,pg. 3
  • 2. Simple Models of Monopsony and Oligopsony,pg. 29
  • 3. Efficiency in Oligopsonistic Labor Markets,pg. 56
  • 4. The Elasticity of the Labor Supply Curve to an Individual Firm,pg. 80
  • 5. The Wage Policies of Employers,pg. 117
  • 6. Earnings and the Life Cycle,pg. 141
  • 7. Gender Discrimination in Labor Markets,pg. 193
  • 8. Employers and Wages,pg. 217
  • 9. Unemployment, Inactivity, and Labor Supply,pg. 239
  • 10. Vacancies and the Demand for Labor,pg. 269
  • 11. Human Capital and Training,pg. 301
  • 12. The Minimum Wage and Trade Unions,pg. 325
  • 13. Monopsony and the Big Picture,pg. 360
  • Data Sets Appendix,pg. 369
  • Bibliography,pg. 379
  • Index,pg. 397

Editorial Reviews

"This is a splendid book. The careful mix of theoretical background and new ways to interpret the empirical evidence provides a unique treatment of the working of the labour market that departs from most other textbooks guided by the competitive paradigm."-Juan J. Dolado, Universidad Carlos III de Madrid, Co-Director of the CEPR Labour Economics Programme