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Title: Estimating the Firm's Labor Supply Curve in a "New Monopsony" Framework: Schoolteachers in Missouri

Citation Type: Conference Paper

Publication Year: 2010

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Abstract: In the context of certain dynamic models, it is possible to infer the elasticity of labor supply to the firm from the elasticity of the quit rate with respect to the wage. Using this property, we estimate the average labor supply elasticity to public school districts in Missouri. We leverage the plausibly exogenous variation in prenegotiated district salary schedules to instrument for actual salary. These estimates imply a labor supply elasticity of about 3.7, suggesting that school districts possess significant market power. The presence of monopsony power in this teacher labor market may be partially explained by its institutional features.

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Authors: Ranson, Michael R.; Sims, David P.

Conference Name: Conference on Modern Models of Monopsony in Labor Markets

Publisher Location: Sundance, UT

Data Collections: IPUMS USA

Topics: Education, Labor Force and Occupational Structure, Other

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