How Antitrust Failed Workers

2021 ◽  
Author(s):  
Eric A. Posner
Keyword(s):  
Economic Growth ◽  
Labor Market ◽  
Labor Markets ◽  
Empirical Research ◽  
Empirical Work ◽  
Employment Practices ◽  
Independent Contractors ◽  
Legislative Reform ◽  
Covenants Not To Compete ◽  
The Impact

Antitrust law has very rarely been used by workers to challenge anticompetitive employment practices. Yet recent empirical research shows that labor markets are highly concentrated, and that employers engage in practices that harm competition and suppress wages. These practices include no-poaching agreements, wage-fixing, mergers, covenants not to compete, and misclassification of gig workers as independent contractors. This failure of antitrust to challenge labor-market misbehavior is due to a range of other failures—intellectual, political, moral, and economic. And the impact of this failure has been profound for wage levels, economic growth, and inequality. In light of the recent empirical work, it is urgent for regulators, courts, lawyers, and Congress to redirect antitrust resources to labor market problems. This book offers a strategy for judicial and legislative reform.

Introduction

2021 ◽  
pp. 1-8
Author(s):  
Eric A. Posner
Keyword(s):  
Economic Growth ◽  
Labor Markets ◽  
Empirical Research ◽  
Bargaining Power ◽  
Labor Law ◽  
Antitrust Law ◽  
Employment Practices ◽  
Independent Contractors ◽  
Covenants Not To Compete ◽  
The Impact

Antitrust law has very rarely been used by workers to challenge anticompetitive employment practices. Yet recent empirical research shows that labor markets are highly concentrated and that employers engage in practices that harm competition and suppress wages. These practices include no-poaching agreements, wage-fixing, mergers, covenants not to compete, and misclassification of gig workers as independent contractors. This failure of antitrust is due to a range of other failures—intellectual, political, moral, and economic. Until recently, economists assumed that labor markets are usually competitive when in fact recent studies reveal that they are usually not competitive. Commentators and politicians also seems to have assumed—falsely—that employment and labor law adequately addresses inequality of bargaining power and the resulting risk of wage suppression. The impact of this failure has been profound for wage levels, economic growth, and inequality.

Labor Monopsony in the United States

2021 ◽  
pp. 11-29
Author(s):  
Eric A. Posner
Keyword(s):  
United States ◽  
Economic Growth ◽  
Labor Market ◽  
Labor Markets ◽  
Market Power ◽  
Empirical Work ◽  
The United States ◽  
Market Concentration ◽  
Wide Range ◽  
Low Wages

Most labor markets are monopsonistic, meaning that employers have market power and can suppress wages below the competitive rate. Among the various sources of market power is concentration: the usually small number of employers who compete to offer a type of job to workers. At one time, economists assumed that labor markets were competitive, and largely ignored the phenomenon of labor market concentration. Recent empirical work, relying on newly available databases, has established that labor market concentration is a serious problem in the United States and may account for a wide range of pathologies, including low wages, inequality, and stagnant economic growth.

Implications of higher retirement age for the labor market

2017 ◽  
pp. 22-39 ◽  
Author(s):  
M. Ivanova ◽  
A. Balaev ◽  
E. Gurvich
Keyword(s):  
Economic Growth ◽  
Labor Market ◽  
Labor Supply ◽  
Labor Force ◽  
Labor Demand ◽  
Retirement Age ◽  
Demographic Trends ◽  
Men And Women ◽  
Demographic Projections ◽  
The Impact

The paper considers the impact of the increase in retirement age on labor supply and economic growth. Combining own estimates of labor participation and demographic projections by the Rosstat, the authors predict marked fall in the labor force (by 5.6 million persons over 2016-2030). Labor demand is also going down but to a lesser degree. If vigorous measures are not implemented, the labor force shortage will reach 6% of the labor force by the period end, thus restraining economic growth. Even rapid and ambitious increase in the retirement age (by 1 year each year to 65 years for both men and women) can only partially mitigate the adverse consequences of demographic trends.

scholarly journals The Impact of Population Aging and Public Health Support on EU Labor Markets

2020 ◽  
Vol 17 (4) ◽  
pp. 1439 ◽  
Author(s):  
Mirela Cristea ◽  
Gratiela Georgiana Noja ◽  
Petru Stefea ◽  
Adrian Lucian Sala
Keyword(s):  
Public Health ◽  
Labor Market ◽  
Older People ◽  
Labor Markets ◽  
Health Expenditure ◽  
Population Aging ◽  
Public Health Expenditure ◽  
Eu Countries ◽  
Life Years ◽  
The Impact

Population aging and public health expenditure mainly dedicated to older dependent persons present major challenges for the European Union (EU) Member States, with profound implications for their economies and labor markets. Sustainable economic development relies on a well-balanced workforce of young and older people. As this balance shifts in favor of older people, productivity tends to suffer, on the one hand, and the older group demands more from health services, on the other hand. These requisites tend to manifest differently within developed and developing EU countries. This research aimed to assess population aging impacts on labor market coordinates (employment rate, labor productivity), in the framework of several health dimensions (namely, health government expenditure, hospital services, healthy life years, perceived health) and other economic and social factors. The analytical approach consisted of applying structural equation models, Gaussian graphical models, and macroeconometric models (robust regression and panel corrected standard errors) to EU panel data for the years 1995–2017. The results show significant dissimilarities between developed and developing EU countries, suggesting the need for specific policies and strategies for the labor market integration of older people, jointly with public health expenditure, with implications for EU labor market performance.

scholarly journals HUMAN CAPITAL AND ITS ROLE IN THE FOURTH INDUSTRIAL REVOLUTION

2021 ◽  
Author(s):  
Yelyzaveta Snitko ◽  
Yevheniia Zavhorodnia
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Labor Market ◽  
Technological Change ◽  
Industrial Revolution ◽  
Skilled Workers ◽  
Fourth Industrial Revolution ◽  
Modern Economy ◽  
The Future ◽  
The Impact

The development of a modern economy, in the context of the fourth industrial revolution, is impossible without the accumulation and development of human capital, since the foundation of the transformation of the economic system in an innovative economy is human capital. In this regard, the level of development and the efficiency of using human capital are of paramount importance. This article attempts to assess the role of human capital in the fourth industrial revolution. In the future, human talent will play a much more important role in the production process than capital. However, it will also lead to a greater division of the labor market with a growing gap between low-paid and high-paid jobs, and will contribute to an increase in social tensions. Already today, there is an increase in demand for highly skilled workers, especially in high-income countries, with a decrease in demand for workers with lower skills and lower levels of education. Analysis of labor market trends suggests that the future labor market is a market where there is simultaneously a certain demand for both higher and lower skills and abilities, combined with the devastation of the middle tier. The fourth industrial revolution relies heavily on the concept of human capital and the importance of finding complementarity between human and technology. In assessing the impact of the fourth industrial revolution, the relationship between technology, economic growth and human resources was examined. The analysis was carried out in terms of three concepts of economic growth, technological change and human capital. Human capital contributes to the advancement of new technologies, which makes the concept of human capital an essential factor in technological change. The authors emphasize that the modern economy makes new demands on workers; therefore it is necessary to constantly accumulate human capital, develop it through continuous learning, which will allow the domestic economy to enter the trajectory of sustainable economic growth. The need to create conditions for a comprehensive increase in the level of human capital development is noted.

Conclusion

2021 ◽  
pp. 161-164
Author(s):  
Eric A. Posner
Keyword(s):  
Artificial Intelligence ◽  
Labor Market ◽  
Labor Markets ◽  
Human Beings ◽  
Independent Contractors ◽  
Gig Economy ◽  
Long Run ◽  
The Social ◽  
Market Fragmentation ◽  
Social Surplus

Many people are worried about the fragmentation of labor markets, as firms replace employees with independent contractors. Another common worry is that low-skill work, and ultimately nearly all forms of work, will be replaced by robots as artificial intelligence advances. Labor market fragmentation is not a new phenomenon and can be addressed with stronger classification laws supplemented by antitrust enforcement. In fact, the gig economy has many attractive elements, and there is no reason to fear it as long as existing laws are enforced. Over the long run, artificial intelligence may replace much of the work currently performed by human beings. If it does, the appropriate response is not antitrust or employment regulation but policy that ensures the social surplus is fairly divided.

Collusion

2021 ◽  
pp. 45-60
Author(s):  
Eric A. Posner
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Common Law ◽  
Product Market ◽  
Antitrust Laws ◽  
Exchange Information ◽  
Covenants Not To Compete

Employers collude in labor markets in a variety of ways. They fix wages, agree not to poach each other’s workers, and exchange information. They also collude with employees by entering covenants not to compete. All of these actions are anticompetitive and they often violate the antitrust laws, but it is difficult for workers to challenge them in court, and few cases have been successful. When workers challenge covenants not to compete, courts defer to the relatively lax common law standard, under which employers do not pay penalties. And strict antitrust standards developed to address product market cases doom labor market cases, where collusion is both easier for employers and easier to hide from authorities. Regulators and courts should be more attentive to the peculiarities of labor markets and more open to antitrust actions.

The Impact of Immigration on Competing Natives' Wages: Evidence from German Reunification

2020 ◽  
Vol 102 (1) ◽  
pp. 79-97 ◽  
Author(s):  
Susanne Prantl ◽  
Alexandra Spitz-Oener
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Democratic Republic ◽  
German Reunification ◽  
Berlin Wall ◽  
Negative Effects ◽  
Labor Market Conditions ◽  
East German ◽  
The Impact ◽  
Direct Measures

After the fall of the Berlin Wall on November 9, 1989, and the collapse of the German Democratic Republic, a sudden, unexpected, and massive influx of East German migrants hit the entire West German labor market. The context is well suited for investigating whether immigration influences natives' wages and how the effects depend on product and labor market conditions. We propose direct measures of potential migration with exogenous variation, compare migrants to natives with similar capabilities, and segment the labor market along predetermined margins. We find that immigration can have negative effects on the wages of natives. These effects surface when product and labor markets are competitive but not under regulations that restrict the entry of firms and provide workers with a strong influence on firms' decision making.

Modern Features of the Transformation of the World and Russian Labor Markets

2020 ◽  
Vol 9 (1) ◽  
pp. 5-12
Author(s):  
Vasiliy Svistunov ◽  
Valeriya Konovalova ◽  
Vitaliy Lobachyev
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Digital Technology ◽  
Digital Technologies ◽  
Value Added ◽  
Individual Factors ◽  
Cation Composition ◽  
The World ◽  
Digital Development ◽  
The Impact

The article is devoted to the assessment of the impact of modern digital technologies on the world and Russian labor market. The relevance of the chosen problem is explained by the fact that the achieved level of digital development of society has a signifi cant impact on the size of labor markets, the qualifi cation composition of workers, the demand for certain professions. The article presents the results of the analysis of the impact of digital technology on the growth of Russia’s GDP, the contribution of individual factors of growth in value added of diff erent sectors of the economy, including the sectoral dimension, the dynamics of digital technologies across regions of the country. The article presents the results of studies characterizing new trends in the labor market, formed as a response to the increasingly active penetration of the digital economy in the socioeconomic sphere of society.

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