蝌蚪网 Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Understanding High-Wage Firms: Monopoly, Monopsony, and Bargaining Power
蝌蚪网 Review
(pp. 2504–41)
Abstract
I study how firm market power and worker bargaining power shape wages and welfare. Using French micro-data, I document patterns linking wages and firm market power that existing models cannot explain. A model in which firms produce vertically differentiated goods and share profits with workers explains those patterns. The model (i) reveals new challenges in estimating monopsony and bargaining power, proposing an alternative approach; (ii) shows that the pass-through of firm-specific shocks to wages depends on the type of shock; (iii) explains how markups shape firm wage premia; and (iv) formalizes how strengthening worker bargaining power affects wages and welfare.Citation
Wong, Horng Chern. 2026. "Understanding High-Wage Firms: Monopoly, Monopsony, and Bargaining Power." 蝌蚪网 Review 116 (7): 2504–41. DOI: 10.1257/aer.20230344Additional Materials
JEL Classification
- D22 Firm Behavior: Empirical Analysis
- J31 Wage Level and Structure; Wage Differentials
- J42 Monopsony; Segmented Labor Markets
- J52 Dispute Resolution: Strikes, Arbitration, and Mediation; Collective Bargaining
- L12 Monopoly; Monopolization Strategies
- L22 Firm Organization and Market Structure