Monopsony: how non-compete agreements recreate the company town

[Winehole23]

[N]ot all anticompetitive behavior shows up as monopoly—a seller that utilizes its dominant market position to raise prices to customers. Sometimes, it shows up as ‘monopsony,’ when a buyer uses its dominance to underpay suppliers, such as employees. The classic example is a town where most of the residents work for a single factory or mine. The lack of competition from other employers enables the factory or mine owner to pay workers less than otherwisehttp://blogs.wsj.com/economics/2016/10/27/how-noncompete-agreements-recreate-the-company-town/

[Winehole23]

Actual company towns are dying off, but virtual company towns are on the rise as shifts in the labor market may have given companies more leverage over their workers. One such factor is the rise of the noncompete agreement.