Journal of Labor Economics Vol. 41 No. S1 2023
Monopsony Power in Higher Education: A Tale of Two Tracks
Abstract
This paper measures the degree of monopsony power in the US higher-education labor market by using school-specific labor demand instruments to directly estimate the residual labor supply curves facing individual universities. The results indicate that schools have significant monopsony power over tenure-track faculty but face perfectly elastic residual labor supply curves for non-tenure-track faculty. There is some evidence for three sources of monopsony power often discussed in the literature—employer concentration, search frictions/job-switching costs, and differentiated jobs. The results also suggest that monopsony over tenure-track faculty may have contributed to the trend toward hiring more non-tenure-track faculty.
- DOI
- 10.1086/726720
- Volume
- 41
- Issue
- S1
- Pages
- S257-S290
- Language
- en
- Sources
- openalex crossref