Wal-Mart's monopsony power in metro and non-metro labor markets

Alessandro Bonanno and Rigoberto Lopez

Regional Science and Urban Economics, 2012, vol. 42, issue 4, 569-579

Abstract: This paper measures the potential degree of monopsony power that Wal-Mart can exert over retail workers using a dominant-firm model and nationwide, county-level data, presenting for the first time a measure of the company's potential anti-competitive behavior and detailed spatial impacts on wages, particularly for metropolitan and non-metropolitan counties. Empirical results show that, at the national level, Wal-Mart's potential wage markdown below the competitive level amounts to less than 3% on average. However, the potential markdowns in non-metropolitan counties are three-fold those in metropolitan counties and are highest in non-metro areas of the south and central states but negligible in northeastern states.

Keywords: Wal-Mart; Wages; Buying Power; Monopsony; Metro; Non-metro (search for similar items in EconPapers)
JEL-codes: J42 L13 L81 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:42:y:2012:i:4:p:569-579

DOI: 10.1016/j.regsciurbeco.2012.02.003

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