"Monopsony" Pronounce,Meaning And Examples

"Monopsony" Meaning

A market structure in which there is only one buyer of a particular good or service.

"Monopsony" Examples

Usage Examples of Monopsony

1. In the labor market, a large employer with a unique product or service can exert monopsony power, paying lower wages to its employees than they would receive in a competitive market.

2. In the early 20th century, the United States was a monopsony in the global oil market, giving it significant bargaining power over oil producers.

3. The airline industry in a particular country may be a monopsony in certain routes, allowing the dominant airline to dictate prices and terms to its customers.

4. Monopsony power can also exist in non-labor markets, such as the market for online services, where a dominant player can set prices and terms for other firms.

5. If a government has a monopoly on the supply of goods or services, it can also act as a monopsony in the labor market, setting wages for all workers in a particular industry or sector.