Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/312024 
Year of Publication: 
2024
Series/Report no.: 
IZA Discussion Papers No. 17585
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Using linked vacancy-employer-employee data from Austria, we investigate how monopsony power affects firms' posting behavior and wage negotiations. Consistent with theoretical predictions, we find that firms with greater monopsony power post lower wages and offer fewer non-wage amenities, suggesting that wages and non-wage benefits are complementary. However, we find no evidence that monopsonistic firms demand higher levels of skill or education. Instead, our results indicate that they require more basic skills, particularly those related to routine tasks. On the workers' side, we find that employees hired in monopsonistic labor markets face significantly lower wages, both initially and in the long run. These lower wages are driven by both lower posted wages and reduced bargaining power, as well as reduced opportunities to climb the wage ladder later.
Subjects: 
monopsony
wages
bargaining
upskilling
JEL: 
J12
J16
J13
J22
Document Type: 
Working Paper

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