Labor monopsony and European competition law

Recent economic research indicates that labor markets tend to be highly concentrated, and that employers use mergers, no-poaching agreements, and related collusive behavior to further concentrate labor markets and exploit labor market power at the expense of workers. In the United States, this research has contributed to new interest in the use of competition law against anticompetitive behavior by employers in labor markets. We suggest that despite differences in U.S. and European labor markets, European competition authorities should also give greater attention to labor market concentration and abuses of labor market power. European competition law provides the authority to do so in most cases; regulatory reform may also be necessary.

Introduction 1. Over the last several years, labor economists have uncovered significant evidence that labor markets in advanced countries are often highly concentrated. Most of the work examines labor markets in the United States, and finds that most American labor markets exhibit very high levels of concentration. [1] There has been less work on European labor markets, but three studies suggest similarly high levels of labor market concentration in France, Portugal, and the UK. [2] In the United States, well-publicized scandals and additional empirical work also suggest that many American employers extend or exploit their labor market power by using non-competes, no-poaching agreements, and other forms of collusion that potentially violate American antitrust law. [3] It seems

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  • University of Chicago
  • OECD - Competition Division (Paris)


Eric A. Posner, Cristina Volpin, Labor monopsony and European competition law, November 2020, Concurrences N° 4-2020, Art. N° 97193,

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