Date of Award


Document Type

Masters Thesis

Degree Name


Organizational Unit

College of Arts Humanities and Social Sciences, Economics

First Advisor

Markus Schneider

Second Advisor

Juan Carlos Lopez

Third Advisor

Robert Urquhart

Fourth Advisor

Jack Sheinbaum


Labor share, Labor share decline, Monopsony, Productivity wage gap, Wage determination


This thesis argues that wage suppression along with the decline in the labor share is caused by a rise in monopsony power realized as a significant increase in the profit share. It attributes the rise in monopsonistic behavior to the development and expansion of the modern corporation. This thesis investigates the reasons for wage suppression, identifies causes of the declining labor share left as exogenous in mainstream models, examines traditional economic wage determination and search models, and evaluates the political economy implications. This work reviews literature on imperfect competition, the corporation, contracts, search and match models, and the motivation of these models to explain wage determination. This thesis finds that traditional economic models do not accurately reflect the labor market because they neglect labor market power. The power wielded by megacorporations is responsible for widely documented wage suppression in the United States.

Publication Statement

Copyright is held by the author. User is responsible for all copyright compliance.

Rights Holder

Alexandra Coulter


Received from ProQuest

File Format




File Size

78 pgs


Economics, Labor economics