This presentation by Cristina VOLPIN, OECD Secretariat, was made during the discussion “Competition Concerns in Labour Markets” held at the 131st meeting of the OECD Competition Committee on 5 June 2019. More papers and presentations on the topic can be found out at oe.cd/cclm.

1. Competition Issues
in
Labour Markets
OECD COMPETITION COMMITTEE
Paris, 05 June 2019
Cristina Volpin
Competition Expert, OECD

2. • Employer monopsony
– “Just as a monopoly depresses production, a labour monopsony
depresses employment below the level that would obtain in a
perfectly competitive market” (Marinescu and Hovenkamp, 2018)
– “Compared to a perfectly competitive labor market, monopsony
leads to lower employment and lower wages” (Marinescu and
Hovenkamp, 2018)
• Low supply elasticity of labour
– commonly interpreted as evidence of labour market monopsony
(Manning, 2003)
– some studies show low level of responsiveness of workers to wages
decreases (Sokolova and Sorensen, 2018; Webber, 2011; OECD,
2019)
– possible factors: asymmetries of information, heterogeneous
preferences, mobility costs and matching difficulties
Monopsony in Labour Markets

3. • Anti-competitive agreements
– e.g., wage-fixing and no-poaching agreements
• Abuse of employer’s monopsony power
– e.g., predatory hiring or imposition of non-compete clauses to
reduce mobility
• Mergers
– increased market power may have anticompetitive effects
• Limited enforcement in labour markets so far
– Legal and economic theory on monopsony power
– Compatibility with consumer welfare standard
– Adjustment of ‘product market tools’
Enforcement in Labour Markets

4. • Market studies
• Guidelines
• Ex post assessment of mergers
• Advocacy in relation to collective bargaining
exemptions
- e.g., exemptions for certain self-employed platform workers
- collective bargaining exemptions in certain circumstances
may entail anticompetitive risks
• Other initiatives
- favour mobility
- correct information asymmetries
Advocacy in Labour Markets

5. THANK YOU
cristina.volpin@oecd.org
5
Thank you