Monopsony Power - 2021 Revision Update
- AS, A-Level, IB
- AQA, Edexcel, OCR, IB, Eduqas, WJEC
Last updated 26 Jan 2021
This series of four short revision videos covers the economics of monopsony power in products markets.
What is meant by a firm having monopsony power in a market?
A monopsony has buying or bargaining power in one or more markets. This means that a monopsony can exploit bargaining power with a supplier to negotiate lower prices. The reduced cost of purchasing factor inputs in theory increases their profit margins.
In the first video, we explore some topical examples of monopsony power.
In this video we use analysis diagrams to consider the impact of monopsony power on producer and consumer welfare.
In this video we look at different ways in which the monopsony power of major buyers in different markets and industries might be counter-balanced.
In this fourth video in the short series on monopsony power we work through five practice multiple choice questions on the economics of monopsony.