Monopsony Flashcards
What are they
Single or dominant buyers of a good or service
What do they try and do
Try and get the lowest prices possible for goods and services from their suppliers to try and reduce costs
What power do they have
Purchasing power
Benefits to firms
Higher SNP
Low costs
Purchasing economies of scale
Benefits and drawbacks to consumers
lower prices possible
could lead to less supply
fall in quality
Examples of them
NHS
National Rail
What’s a trade union
An organisation that represents a group of employees
Geographical immobility of labour
When workers find it difficult to move from one area to another
Occupational mobility
Refers to the ability of workers to transfer from one occupation to another, based on skills they possess
How are NHS a monopsony
As they control 90% of healthcare, give doctors low wages as possible
NMW in place
Trade unions in place cause a “min price”
Why does unemployment increase after trade union
Firms are demanding less labour due to higher wages which means greater costs
Demand for jobs would increase dent higher pay
