Asked by lovely cupcake on Apr 27, 2024
Verified
If an industrial union is formed to bargain with a monopsonistic employer,then in this labor market:
A) the resulting wage rate will always be above the competitive level.
B) employment may either increase or decrease.
C) employment will increase.
D) employment will decrease.
Industrial Union
A labor union that organizes workers across various industries, rather than according to skill or trade.
Monopsonistic Employer
An employer who has significant market power in hiring or purchasing, allowing them to dictate terms to their suppliers, often leading to lower prices or wages.
- Analyze the structure and implications of bargaining dynamics in labor markets, especially in contexts of monopsony and bilateral monopoly.
Verified Answer
HB
Hardeep BatthMay 03, 2024
Final Answer :
B
Explanation :
The formation of an industrial union to bargain with a monopsonistic employer can lead to either an increase or decrease in employment, depending on the bargaining power of the union and the employer. The resulting wage rate may be above the competitive level, but this is not always the case.
Learning Objectives
- Analyze the structure and implications of bargaining dynamics in labor markets, especially in contexts of monopsony and bilateral monopoly.
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