4 Comments

What about monopsonistic forces, which intuitively should come into play in industries with large concentration? While unions wouldn't help the reduced quantity of labor, they would help re-adjust wages up from their artificially lower state.

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Monopsony is unrealistic especially in low-skill labor markets where unionization is common.

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I don’t see how it’s flatly unrealistic. A priori we should actually expect some industries to not satisfy the conditions, for various reasons, that make market clearing work.

I think you’d also admit that there are public monopsonies, an example being education. If 85% of the hiring of teachers is done by a county doesn’t that give them extreme power to set wages?

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Also a very small nitpick I found when fact-checking is that the Governor's support for unionization is probably exaggerated, knowingly or unknowingly, by the Cato paper. From the little information that exists about him online, I see that he was famously neutral in labor disputes, which effectively meant calling in the state militia to prevent violence during labor conflicts. It seems that he used the militia to variously suppress scabs, strikers, or corporate leaders depending on the case.

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