@article{39c30a87f1384b699549b288e6133b5c,
title = "Making their own weather?: Estimating employer labour-market power and its wage effects",
abstract = "The subdued wage growth observed in many countries has spurred interest in monopsony views of regional labour markets. This study measures the extent and robustness of employer power and its wage implications exploiting comprehensive matched employer–employee data. We find average (employment-weighted) Herfindhal indices of 800 to 1,100, stable over the 1986–2019 period covered, and that typically less than 8% of workers are exposed to concentration levels thought to raise market power concerns. When controlling for both worker and firm heterogeneity and instrumenting for concentration, we find that wages are negatively affected by employer concentration, with elasticities of around −1.4%. We also find that several methodological choices can change significantly both the measurement of concentration and its wage effects.",
keywords = "Oligopsony, Portugal, Regional labour markets, Wages, Worker mobility",
author = "Martins, {Pedro S.} and Ant{\'o}nio Melo",
note = "Funding Information: The authors thank the Editor, three referees, Orley C. Ashenfelter, Andrea Bassanini, Eve Caroli, Wenjing Duan, Judite Goncalves, Juan Jimeno, Claudio Lucifora, Ioana Marinescu, Evan Starr, Marshall Steinbaum, Bledi Taska and conference/workshop participants at the American Economic Association (San Diego), Queen Mary University of London, and the European Commission for comments. The authors also thank INE and the Ministries of Education and Employment, Portugal, for data access, the European Union for financial support ( VS/2016/0340 and VP/2019/004/0038 grants) and Joana Saraiva for research assistance. Ant{\'o}nio Melo acknowledges funding by a Ph.D. scholarship from Funda{\c c}{\~a}o para a Ci{\^e}ncia e Tecnologia ( SFRH/BD/146123/2019 ). The usual disclaimer applies. Funding Information: The authors thank the Editor, three referees, Orley C. Ashenfelter, Andrea Bassanini, Eve Caroli, Wenjing Duan, Judite Goncalves, Juan Jimeno, Claudio Lucifora, Ioana Marinescu, Evan Starr, Marshall Steinbaum, Bledi Taska and conference/workshop participants at the American Economic Association (San Diego), Queen Mary University of London, and the European Commission for comments. The authors also thank INE and the Ministries of Education and Employment, Portugal, for data access, the European Union for financial support (VS/2016/0340 and VP/2019/004/0038 grants) and Joana Saraiva for research assistance. Ant{\'o}nio Melo acknowledges funding by a Ph.D. scholarship from Funda{\c c}{\~a}o para a Ci{\^e}ncia e Tecnologia (SFRH/BD/146123/2019). The usual disclaimer applies. Publisher Copyright: {\textcopyright} 2023 The Author(s)",
year = "2024",
month = jan,
doi = "10.1016/j.jue.2023.103614",
language = "English",
volume = "139",
journal = "Journal of Urban Economics",
issn = "0094-1190",
publisher = "Elsevier Science B.V., Amsterdam.",
}