15 June 2012

Adam Smith on employers' bargaining power

"We rarely hear, it has been said, of the combination of masters; though frequently of those of workmen. But whoever imagines, upon this account, that masters rarely combine, is as ignorant of the world as of the subject" (Smith in the wealth of nations, p 84, quoted in Manning (2003) Monopsony in Motion: Imperfect competition in Labor Markets, page 14; footnote 9)

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