Goerke, Laszlo; Neugart, Michael - In: Canadian Journal of Economics/Revue canadienne d'économique 54 (2021) 2, pp. 864-891
Monopsony power by firms and social preferences by consumers are well established. We analyze how wages and employment change in a monopsony if workers compare their income with that of a reference group. We show that the undistorted, competitive outcome may no longer constitute the benchmark...