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    Hi


    in the basic diagram of supply and demand, equilibrium employment occurs at the point where supply intersects demand

    but what market structure is this diagram for? in perfectly competitive labour markets, supply is perfectly elastic, in monopsonies and oligopsonies employment occurs below equilibrium because the firms employ where mc=mrp, so what market does this diagram represent?
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    it represent the labour market.

    there are no monopolies and oligopolies in the labour market as such. these would be looked at in special cases such as say labour unions.

    the labour market is the same* for an industry who is market structure is a monopoly and an industry whose market structure is an oligopoly.

    * given certain assumptions about the labor market.
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    (Original post by danny111)
    it represent the labour market.

    there are no monopolies and oligopolies in the labour market as such. these would be looked at in special cases such as say labour unions.

    the labour market is the same* for an industry who is market structure is a monopoly and an industry whose market structure is an oligopoly.

    * given certain assumptions about the labor market.
    okay... so it is represents the demand and supply of labour across all industries and markets, whereas a monopsony diagram would only represent the demand and supply of labour in a specific market, for example the employment of doctors by the government?
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    (Original post by TPJY)
    okay... so it is represents the demand and supply of labour across all industries and markets, whereas a monopsony diagram would only represent the demand and supply of labour in a specific market, for example the employment of doctors by the government?
    I don't understand what you are asking. When we talk about the labour market, we usually make a few assumptions regarding supply and demand and then go from there. And yes when you build a model of the economy you take the labour market to be the labour market of the economy. You don't make different labour markets for each industry. You might do this when you study a specific industry, I don't know I haven't seen this before.

    Are you at A level or uni? At A level this might be different I don't know.

    I don't get what you mean by "a monopsony diagram would only represent the demand and supply of labour in a specific market".
 
 
 
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