Monopsony power in migrant labor markets

Evidence from the United Arab Emirates

Suresh Naidu, Yaw Nyarko, Shing Yi Wang

    Research output: Contribution to journalArticle

    Abstract

    By exploiting a reform in the United Arab Emirates that relaxed restrictions on employer transitions, we provide new estimates of the monopsony power of firms over migrant workers. Our results show that the reform increased incumbent migrants’ earnings and firm retention. This occurs despite an increase in employer transitions and is driven by a fall in country exits. While the outcomes of incumbents improved, the reform decreased demand for new migrants and lowered their earnings. These results are consistent with a model of monopsony in which firms face upward-sloping labor supply curves for both new recruits in source countries and incumbent migrants.

    Original languageEnglish (US)
    Pages (from-to)1735-1792
    Number of pages58
    JournalJournal of Political Economy
    Volume124
    Issue number6
    DOIs
    StatePublished - Dec 1 2016

    Fingerprint

    Monopsony
    Migrants
    Labour market
    Migrant labor
    United Arab Emirates
    Incumbents
    Employers
    Migrant workers
    Labor supply
    Exit

    ASJC Scopus subject areas

    • Economics and Econometrics

    Cite this

    Monopsony power in migrant labor markets : Evidence from the United Arab Emirates. / Naidu, Suresh; Nyarko, Yaw; Wang, Shing Yi.

    In: Journal of Political Economy, Vol. 124, No. 6, 01.12.2016, p. 1735-1792.

    Research output: Contribution to journalArticle

    Naidu, Suresh ; Nyarko, Yaw ; Wang, Shing Yi. / Monopsony power in migrant labor markets : Evidence from the United Arab Emirates. In: Journal of Political Economy. 2016 ; Vol. 124, No. 6. pp. 1735-1792.
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