Using Oligopsony Theory And Monopsonistic Competition

Oligopolistic markets, such as supermarkets or car manufacturing, can be defined in terms of market structure or in terms of market conduct.

II.B. It may raise unemployment and restrict the freedom of employers. Chapter 2–3 1. capitalism 2. free

In this article Michael Baker discusses the livelihood of small retailers in a market subjugated by the financially dominant oligopolies, Woolworths and Coles. While the small independent retailers in direct competition with Woolworths and Coles provide some competitive respite for consumers, as they encourage competitive pricing, albeit predatory pricing, it is clear that Woolworths and Coles control the supermarket industry in Australia, in the formation of a duopoly. It is evident that Woolworths and Coles engage in predatory pricing in an attempt to eliminate independent retailers from the market. This article discusses recent efforts made by the Australian government and the Australian Competition

When companies train their employees well, they equip their employees with the necessary skills to perform well in their roles. This in turn translates into higher productivity because employees will be able to complete tasks more efficiently and effectively. The quality of work that employees create will also be higher because the training programs will teach employees how to perform well and fine-tune their skills and accuracy. For example, IBM's e-learning program for new managers, Basic Blue, costs $8,708 per manager. The company has measured an improvement in each new manager's performance worth $415,000. For every $1 that IBM invests in Basic Blue, it receives almost $47 (HRM 154). Therefore, if businesses want to gain a high return on investment, it is imperative that they also invest in training their employees. In our simulation, we had hired and promoted roughly 50-75 workers in each quarter of our first three quarters. However, we decreased the training budget each quarter, despite our increase in workers hired and promoted. This decrease in training investment led to a high accident rate and low quality index. When we spent larger amounts in training workers, and in the different training programs, there were direct correlations between increased training costs and the different outcomes intended of the

There are many models of market structure in the field of economics. They include perfect competition on one end, monopoly on the other end, and competitive monopoly and oligopoly somewhere in the middle. In this paper, we will focus on the oligopoly structure because it is one of the strongest influences in the United States market. Although oligopolies can also be global, we will focus strictly on the United States here. We will define oligopoly, give key characteristics important to the oligopoly structure, explain why oligopolies form, then give an example of an oligopoly in today’s economy. Finally, we will discuss the benefits and costs in this type of market structure.

Some company pays educational institutions directly for expensive, intense training programs that require payment up front (O’Reilly, Brendan 2001). Today, nearly 15 percent of our domestic workforce is enrolled in college and university coursework, more than half seeking advanced degrees. Our participation rates are three times the national average for companies with similar programs. And, participants' retention rate is double that of all employees (Cassidy, John F. 2004).

The article “Beyond United: How oligopolies hurt Americans’ pocketbooks” written by James Downie for The Washington Post discusses the financial issues that arise from oligopoly control. The article explains how, because of mergers, the airline industry has gone from nine major companies to just four. The author argues, “Travelers can’t avoid higher fairs and fees unless they choose not to fly” (Downie). Downie brings attention to the growing profits for the consolidated airline companies while consumers pay the same or higher prices. He also explains how the drug industry operates as an oligopoly with only three companies controlling 75 percent of the market. These three companies control drug prices and touch every wallet in America. Downie

Although most people think that everybody who lives in the United States has job mobility, many people get stuck in jobs or industries that do not allow them to have any job mobility in the labor market. A situation that inhibits job mobility is in a monopsony, which is an environment where there is only one single buyer in the market; a monopsony is the opposite of a monopoly. This essay will examine the effects of a minimum wage increase in a monopsony setting and in a perfect competition setting.

The automotive industry has drastically transformed since World War II. In the early 20th century America had many booming car companies with an array of beautiful designs. Early 20th century automobiles were a thing of art, each brand having their own unique signature design. The article by Thomas Lifson, titled Oligopoly and the fall of the American automobile industry describes this event that unfolded in America’s auto industry. The article highlights how oligopolies in the automotive sector made for competitive prices, however, what consumers gained in bargain they lost in the art that went into a unique design.

These policies also encourage employers to increase training investments. Economists Daron Acemoglu and Jörn‐Steffen Pischke showed in their study (1999) that compression in the structure of wages can cause firm-sponsored training. They concluded “When the wage structure is distorted away from the competitive benchmark and in favor of less skilled workers, firms may want to invest in the general skills of their employees” In their research, in 2001, they also state “In noncompetitive labor markets, minimum wages tend to increase training of affected workers because they induce firms to train their unskilled employees.”

What is a monopoly? According to Webster's dictionary, a monopoly is "the exclusive control of a commodity or service in a given market.” Such power in the hands of a few is harmful to the public and individuals because it minimizes, if not eliminates normal competition in a given market and creates undesirable price controls. This, in turn, undermines individual enterprise and causes markets to crumble. In this paper, we will present several aspects of monopolies, including unfair competition, price control, and horizontal, vertical, and conglomerate mergers.

For monopsonistic competition, the term describes the condition which oligopsony has free entry or exit and all employer profits are zero. These terms are the most precise descriptions for the labour market that has coexistence of competition between employers and their degree market power. In this article, we will discuss on two issues with the application of oligopsony theory and monopsonistic competition: why firms might pay for “general” training of workers and why minimum wages could increase employment. We will also conclude the two sections by outlining a number of circumstances that we should expect to observe these theoretical predictions in the real world if possible.

This paper studies the idea of competition. What is competition? Do we need competition, why do we need it? The paper further elaborates competition in aspects of two school of thoughts, the Classical and Marxist economics.

However, this method does not work well because the training workers may work for other firms after the training. Yet, this method is a good method from the point of view of the State because the social marginal net product is substantial than the private marginal net product. Besides, this method is costly and considered as capital investment.

In imperfect competition, labour markets can lead to worker exploitation in terms of the wage rates