Question

Players tend to unionize when facing a monopsony in an attempt to

Select one:

a. Keep out lower quality talent willing to play for a lower wage

b. Monopolize the sale of talent, thereby creating a bilateral monopoly.

c. Invite competition and undermine the monopsony

d. Pay for lengthy antitrust lawsuits against the league

Answer 1

ans b)

monopolize the sale of talent , thereby creating a bilateral monopoly

expalanation

in case of monopsony , firms pay less wages and employ less labour , when unions are there tah they can bargain for higher wages without affecting the employment level. in monopsony , there is single buyer of labour and when unionization is done , there will single seller of talent , so all the workers will have same terms and conditions of working, a kind of uniformity will be maintained and labor can't be exploited. Single seller as well as single buyer of labor will create bilateral monopoly