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Large firms are able to push down wages because they face little competition as the buyer of labor. The economist Joan Robinson called this... O Antitrust O Monopsony Power OA Labor Strike O Monopoly Power

Large firms are able to push down wages because they face little competition as the buyer of labor. The economist Joan Robinson called this... O Antitrust O Monopsony Power OA Labor Strike O Monopoly Power

Principles Of Marketing
Principles Of Marketing
17th Edition
ISBN:9780134492513
Author:Kotler, Philip, Armstrong, Gary (gary M.)
Publisher:Kotler, Philip, Armstrong, Gary (gary M.)
Chapter1: Marketing: Creating Customer Value And Engagement
Section: Chapter Questions
Problem 1.1DQ
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**Understanding Economic Concepts: Market Power in Labor Markets** Large firms are able to push down wages because they face little competition as the buyer of labor. The economist Joan Robinson called this... - Antitrust - Monopsony Power - A Labor Strike - Monopoly Power **Explanation of Terms:** 1. **Antitrust**: Antitrust laws are regulations that promote competition by limiting the market power of any particular firm. These laws prevent monopolies and promote fair competition for the benefit of consumers. 2. **Monopsony Power**: A monopsony occurs when there is only one buyer—or a dominant single buyer—in a market. For a labor market, this means one employer has significant control over wage rates and employment conditions because workers have few alternatives. 3. **A Labor Strike**: A labor strike is an organized stoppage of work by employees as a form of protest, typically to gain concessions from their employer in terms of wages, hours, or working conditions. 4. **Monopoly Power**: A monopoly exists when a single firm is the sole provider of a good or service in a market. This allows the firm to control prices and exclude competition. **Key Insight:** The correct answer to the question refers to 'Monopsony Power'. Joan Robinson, a notable economist, explored how firms with monopsony power can exert considerable control over wages because there is little competition among employers to hire workers. This concept is essential for understanding labor market dynamics and the potential for wage suppression in markets where employers hold significant power.
Transcribed Image Text:**Understanding Economic Concepts: Market Power in Labor Markets** Large firms are able to push down wages because they face little competition as the buyer of labor. The economist Joan Robinson called this... - Antitrust - Monopsony Power - A Labor Strike - Monopoly Power **Explanation of Terms:** 1. **Antitrust**: Antitrust laws are regulations that promote competition by limiting the market power of any particular firm. These laws prevent monopolies and promote fair competition for the benefit of consumers. 2. **Monopsony Power**: A monopsony occurs when there is only one buyer—or a dominant single buyer—in a market. For a labor market, this means one employer has significant control over wage rates and employment conditions because workers have few alternatives. 3. **A Labor Strike**: A labor strike is an organized stoppage of work by employees as a form of protest, typically to gain concessions from their employer in terms of wages, hours, or working conditions. 4. **Monopoly Power**: A monopoly exists when a single firm is the sole provider of a good or service in a market. This allows the firm to control prices and exclude competition. **Key Insight:** The correct answer to the question refers to 'Monopsony Power'. Joan Robinson, a notable economist, explored how firms with monopsony power can exert considerable control over wages because there is little competition among employers to hire workers. This concept is essential for understanding labor market dynamics and the potential for wage suppression in markets where employers hold significant power.
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