This papers attempts to show that the neoclassical analysis of monopsony is erroneous. We deal with this issue under two sub-headings: those compatible with mainstream economics, and those that are not. In the first category are: paucity, wrong target, temporariness, limited window, complexity, information and timing (length of run). In the second category are those stemming from an alternative economic perspective, Austrianism: objective expenses vs. subjective costs, reliance on illegitimate interpersonal comparisons of utility, failure of trade to occur, coerced income transfers, difficulties with perfect competition and geometrical/mathematical considerations.
Monopsony, interpersonal comparisons of utility, market failure, minimum wage law, unemployment, anti-trust, regulation of business
How to Cite
Block, W. & Barnett II, W., (2009) “Monopsony Theory”, American Review of Political Economy 7(1). doi: https://doi.org/10.38024/arpe.107