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Labor Market Polarization, Job Tasks, and Monopsony Power

Author

Listed:
  • Ronald Bachmann
  • Gökay Demir
  • Hanna Frings

Abstract

Using a semistructural approach based on a dynamic monopsony model, we examine to what extent workers performing different job tasks are exposed to different degrees of monopsony power and whether these differences in monopsony power have changed over the last 30 years. We find that workers performing mostly nonroutine cognitive tasks are exposed to a higher degree of monopsony power than workers performing routine or nonroutine manual tasks. Job-specific human capital and nonpecuniary job characteristics are the most likely explanations for this result. We find no evidence that labor market polarization has increased monopsony power over time.

Suggested Citation

  • Ronald Bachmann & Gökay Demir & Hanna Frings, 2022. "Labor Market Polarization, Job Tasks, and Monopsony Power," Journal of Human Resources, University of Wisconsin Press, vol. 57(S), pages 11-49.
    • Handle: RePEc:uwp:jhriss:v:57:y:2022:i:s:p:s11-s49
    Note: DOI: 10.3368/jhr.monopsony.0219-10011R1
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    File URL: http://jhr.uwpress.org/cgi/reprint/57/S/S11
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    Citations

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    Cited by:

    1. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 117999, London School of Economics and Political Science, LSE Library.
    2. Petur O. Jonsson, 2025. "On Intersectionality, Groups, Discrimination, and Labor Markets," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 31(4), pages 281-299, November.
    3. Jorge Davalos & Ekkehard Ernst, 2021. "How has labour market power evolved? Comparing labour market monopsony in Peru and the United States," Papers 2103.15183, arXiv.org.
    4. Blömer, Maximilian J. & Guertzgen, Nicole & Pohlan, Laura & Stichnoth, Holger & van den Berg, Gerard J., 2024. "Unemployment effects of the German minimum wage in an equilibrium job search model," Labour Economics, Elsevier, vol. 91(C).
    5. Kovalenko, Tim & Sauerbier, Timo & Schröpf, Benedikt, 2024. "The fall and rebound of average establishment size in West Germany," Discussion Papers 11/2024, Deutsche Bundesbank.
    6. Mauro Caselli & Andrea Locatelli & Stefano Schiavo, 2025. "Labour market frictions across worker types," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 42(3), pages 799-827, October.
    7. Ihsaan Bassier, 2022. "Firms and inequality when unemployment is high," CEP Discussion Papers dp1872, Centre for Economic Performance, LSE.
    8. Jose Garcia-Louzao & Alessandro Ruggieri, 2023. "Labor Market Competition and Inequality," Bank of Lithuania Working Paper Series 117, Bank of Lithuania.
    9. Bassier, Ihsaan, 2023. "Firms and inequality when unemployment is high," Journal of Development Economics, Elsevier, vol. 161(C).
    10. Carolin Linckh & Samuel Muehlemann & Harald Pfeifer, 2024. "Beggars cannot be choosers: Labor market tightness and hiring standards, wages, and hiring costs," Economics of Education Working Paper Series 0217, University of Zurich, Department of Business Administration (IBW).
    11. Kovalenko, Tim & Sauerbier, Timo & Schröpf, Benedikt, 2023. "The fall and rebound of average establishment size in West Germany," Discussion Papers 126, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    12. Bachmann, Ronald & Heinze, Inga & Hörnig, Lukas & Klauser, Roman, 2025. "Erfolgreiche Jobwechsel. Wie berufliche Mobilität Einkommen und Arbeitszufriedenheit steigert," EconStor Books, ZBW - Leibniz Information Centre for Economics, number 322261 edited by Bertelsmann Stiftung, February.
    13. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 121970, London School of Economics and Political Science, LSE Library.
    14. Han, Qingyang, 2024. "Estimating labor market monopsony power from a forward-looking perspective," Economics Letters, Elsevier, vol. 244(C).

    More about this item

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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