Wal-Mart’s Monopsony Power in Local Labor Markets
AbstractDespite considerable debate as to Wal-Mart’s impact on retail workers, to date there has been little structural analysis on the topic. This paper measures and tests for Wal-Mart’s monopsony power in local labor markets using a dominant-firm model and data on contiguous U.S. counties where the company operates. Empirical results show that Wal-Mart’s monopsony power over workers varies significantly across the country, being higher in rural counties, particularly in the south. For instance, Wal-Mart’s buying power index in labor markets in rural southern central states is estimated to be 6% or higher while the impact on northeastern states’ wages is negligible. The results suggest that this is not a nationwide problem.
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Bibliographic InfoPaper provided by University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy in its series Food Marketing Policy Center Research Reports with number 103.
Length: 33 pages
Date of creation: Feb 2008
Date of revision:
Wal-Mart; monopsony power; wages; labor; retailing;
Other versions of this item:
- Bonanno, Alessandro & Lopez, Rigoberto A., 2008. "Wal-Mart’s Monopsony Power in Local Labor Markets," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6219, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Bonanno, Alessandro & Lopez, Rigoberto, 2008. "Wal-Mart’s Monopsony Power in Local Labor Markets," Research Reports 149210, University of Connecticut, Food Marketing Policy Center.
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