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Oligopsonistic Cats and Dogs

Author

Listed:
  • Gerda Dewit

    (National University of Ireland Maynooth)

  • Dermot Leahy

    (University College Dublin)

Abstract
We study the strategic investment behaviour of oligopsonistic rivals in the labour market. Under wage competition, firms play "puppy dog" with productivityaugmenting investment and "fat cat" with supply-enhancing investment. Under employment competition, investing strategically always involves playing "top dog".

Suggested Citation

  • Gerda Dewit & Dermot Leahy, 2005. "Oligopsonistic Cats and Dogs," Economics Department Working Paper Series n1590905, Department of Economics, National University of Ireland - Maynooth.
    • Handle: RePEc:may:mayecw:n1590905
    as

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    File URL: http://repec.maynoothuniversity.ie/mayecw-files/N1590905.pdf
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    References listed on IDEAS

    as
    1. Manning, Alan, 2004. "Monopsony and the efficiency of labour market interventions," Labour Economics, Elsevier, vol. 11(2), pages 145-163, April.
    2. Neary, J Peter & Leahy, Dermot, 2000. "Strategic Trade and Industrial Policy towards Dynamic Oligopolies," Economic Journal, Royal Economic Society, vol. 110(463), pages 484-508, April.
    3. Fudenberg, Drew & Tirole, Jean, 1984. "The Fat-Cat Effect, the Puppy-Dog Ploy, and the Lean and Hungry Look," American Economic Review, American Economic Association, vol. 74(2), pages 361-366, May.
    4. repec:bla:reviec:v:9:y:2001:i:2:p:249-61 is not listed on IDEAS
    5. Bhaskar, V. & To, Ted, 2003. "Oligopsony and the distribution of wages," European Economic Review, Elsevier, vol. 47(2), pages 371-399, April.
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    9. Hwang, Hae-shin & Mortensen, Dale T & Reed, W Robert, 1998. "Hedonic Wages and Labor Market Search," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 815-847, October.
    10. Bhaskar, V & To, Ted, 1999. "Minimum Wages for Ronald McDonald Monopsonies: A Theory of Monopsonistic Competition," Economic Journal, Royal Economic Society, vol. 109(455), pages 190-203, April.
    11. Lapham, Beverly & Ware, Roger, 1994. "Markov puppy dogs and related animals," International Journal of Industrial Organization, Elsevier, vol. 12(4), pages 569-593, December.
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    Cited by:

    1. Tabasso, D, 2009. "Temporary Contracts and Monopsony Power in the UK Labour Market," Economics Discussion Papers 8938, University of Essex, Department of Economics.
    2. Coccorese, Paolo, 2012. "Banks as ‘fat cats’: Branching and price decisions in a two-stage model of competition," Journal of Economics and Business, Elsevier, vol. 64(5), pages 338-363.

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    More about this item

    Keywords

    Oligopsony; Strategic behaviour; Productivity-augmenting investment;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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