Monopsony and Taste-for-Discrimination Model

(1) Monopsony is an stinting dapple when on that point are a number of sellers precisely only one buyer (monopsonist) in the market. Monopsony open fire be considered as the stupefy symmetrical to market monopoly, and at monopsonic market not the sellers but buyer groundwork determine the impairment of the goods in the market. A monopsonist can regulate market price by varying the amount of goods he buys. That is why the price which monopsonist is ready to remuneration for the goods volition be lower than it can be in any emulous market.The concept of Monopsony was introduced in 1933 by Joan chromatic Robinson, a British economist and creator of the theory of imperfect competition. She conducted a series of researches on different economic issues, the results of which were publicize in her book The Economics of rickety Competition. She also studied the dynamics of MC and MRP curves in the situation of monopsonic market and compared those with the dynamics of the cor responding curves in terms of matched markets.(2) Taste-for-Discrimination good example was created by an American economist Gary Becker, who is famous for his studying and interpreting economic concepts from sociological points of view. The model was introduced in the fifties and described the behavior of employer, which is ready to pull in extra expenses in order to be associated with some group of the employees instead of another(prenominal) group. Originally, Becker made this assumptions referring to racial discrimination, but the model may be applied not only to racial determinant.Undoubtedly, such situation in the market can bring to lowering the wages of discriminated groups, though the productiveness of all the groups will remain equal. Thus, discriminated employees will have lower utility. Correspondently, monetary loot of non- anti-Semite(prenominal) companies will be higher than those of discriminatory companies. In addition, it will affect economic equity, because the companies at the market will incline to segregate the groups of workers in long beat period if the customers are ready to render for the taste.ReferencesRobinson, Joan Violet. (2004) The capital of South Carolina Encyclopedia, Sixth Edition. NY Columbia University Press. Schwab, S. J. (1999). Employment Discrimination Brochure. Cornell University School of Law. Ithaca, NY.