Monopsony
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It isn't often that I encounter an English word that I don't know other than names of chemical compounds, but I recently learned a new word for something not all that obscure. In a context in which I expected the word monopoly, I encountered monopsony. At first I thought it was a mistake, but it recurred. It turns out that economists distinguish between monopolies and monopsonies. When there is a single source for a product, that is a monopoly, but when there is only a single buyer for a product, that is a monopsony. Who knew?
The classic example of a monopsony is what I have hitherto known as the Chinese salt monopoly. Throughout most of Chinese history, anybody could produce salt, but they had to sell it to the government, which then sold it to consumers. This is why the classic work of Chinese economics, the proceedings of a conference held in 81 BCE with appended commentary, is entitled 塩鉄論 Discourses on Salt and Iron.
John Cowan said,
July 21, 2009 @ 10:29 pm
The person who coined monopsony is known: the classicist B.L. Hallward, at the request of and for use by the economist Joan Robinson in her 1932 book The Economics of Imperfect Competition. Strictly, opsonein means 'to buy fish' (< opson 'fish, cooked meat'), but the more general verb oneomai 'buy' would have produced monoöny, an obscure spelling and easily confused in speech with monotony. It's not clear why priamai 'buy', which would have led to monopry, was rejected.
There is also the word oligopsony with the obvious meaning, coined by the economist E. Ronald Walker in 1943. See Robert J. Thornton's article in The Journal of Economic Perspectives, 18:2 (Spring, 2004), pp. 257-261.
Fluxor said,
July 21, 2009 @ 11:58 pm
Discourses on Salt and Iron
鹽鐵論 – traditional Chinese
盐铁论 – simplified Chinese
塩鉄論 – Kanji
Not that it would confuse any educated Chinese reader, but is there any reason for choosing the simplified Japanese version of the title in your post given that it's a Chinese book?
Adrian Mander said,
July 22, 2009 @ 2:40 am
I looked up the IPA if anyone is too lazy to do it:
/məˈnɒpsəni/
Ian Preston said,
July 22, 2009 @ 3:21 am
It's a concept capable of inspiring an economist to song. To hear Monopsony in Motion and read the lyrics (with etymological link), go here.
Tim said,
July 22, 2009 @ 3:43 am
It is unfortunate that the coiner did not take that route, mainly because I enjoy (the sadly rare) words with diereses.
However, I would tend to pronounce it /məˈnəʊəni/ (I have no training in transcribing sounds into IPA, so excuse me if that's terrible), which, with its "long" O, would seem easy to distinguish from monotony, with its /a/ vowel. (I won't even try to IPAify that one, as I think it might involve a glottal stop and maybe a syllabic /n/. I'll leave that to the professionals. Hints would be appreciated, though.)
Frankly, I think the most likely pronunciation issue would be, due to the afore-lamented disuse of the dieresis, a rendering something like /məˈnu:ni/.
mkvf said,
July 22, 2009 @ 8:21 am
More topically, it describes systems like the British NHS: one of the arguments for a single payer system is that is that it allows for central control of prices of products and services. Perhaps that's why there's a market for US-made pharmaceuticals to be sold back to the US from Canada?
Bob Lieblich said,
July 22, 2009 @ 8:27 am
The United States Navy must, by law, purchase all its warships from US shipyards. Only one shipyard in the US is capable of building an aircraft carrier. In this situation, a monopsonist confronts a monopolist. It leads to a very interesting contractual relationship. It's also the reason I've known the word "monopsony" for a long time.
Jean-Sébastien Girard said,
July 22, 2009 @ 11:22 am
I'd think "monopry" was rejected straightaway because of the verb "pry"?
Richard Hershberger said,
July 22, 2009 @ 11:45 am
"Who knew?"
Ooh! Ooh! Ooh! Mr. Poser! Call on me! Call on me!
But seriously, I only knew the word from one magazine article about WalMart.
Morgan said,
July 22, 2009 @ 11:55 am
I'm pretty sure I learned this in high school economics, or college econ at the latest. Is it really considered that obscure?
Zwicky Arnold said,
July 22, 2009 @ 12:50 pm
To Morgan: "I'm pretty sure I learned this in high school economics, or college econ at the latest. Is it really considered that obscure?"
So you know the word and have known it for some time. All Bill Poser said was that the word was new to him. In any case, the word is only a technical term, while monopoly is a word of ordinary English (and also a technical term in economics), and monopsony is vastly less common than monopoly: the monopoly:monopsony ratio of raw google webhits is roughly 130:1.
Ginger Yellow said,
July 22, 2009 @ 1:16 pm
"The United States Navy must, by law, purchase all its warships from US shipyards. Only one shipyard in the US is capable of building an aircraft carrier. In this situation, a monopsonist confronts a monopolist. It leads to a very interesting contractual relationship. It's also the reason I've known the word "monopsony" for a long time."
In general, US defence contractors could be said to be operating in a monopsony, loosely defined. After all, they can only sell to the US government or governments approved (and often subsidised) by the US government. Not being an economist, however, I don't know if that market shares similar characteristics to true monopsonies.
Dan T. said,
July 22, 2009 @ 2:09 pm
In the game of Monopsony, I expect that when you pass "Go", you have to pay $200.
J. W. Brewer said,
July 22, 2009 @ 3:10 pm
The Chinese "salt monopoly" was both a monopsony (as purchaser from producers) and a monopoly (as reseller at perhaps abusive markup to consumers), so it makes sense that it would be commonly known in English by the more common word, which is also usually the more salient word (since presumably every household in China needed to buy salt but only a tiny percentage of the population would have been in a position to sell it). I am not an economist and managed to get through four years of college without a single economics class, but I've known the word since I don't know when; I assume I probably picked it up in the context of antitrust law, where the lawyers and judges had borrowed it from the economists.
Richard said,
July 22, 2009 @ 4:18 pm
On NPR's Planet Money not too long ago, there was a story on the economics of piracy, which explained the monopolist-monopsononist relationship, that is, there is only one seller (the pirate), and only one buyer (the ship's owner), and yet they still have to agree on the "market" price. Well worth a listen!
Athanassios Protopapas said,
July 22, 2009 @ 6:41 pm
It is slightly amusing that ψώνια, pronounced /ˈpsoɲa/ (with a palatalized nasal instead of /n/), is Modern Greek for "shopping".
Athanassios Protopapas said,
July 22, 2009 @ 6:46 pm
…and ψωνίζω /psoˈnizo/ is the verb "to shop"
Rick Robinson said,
July 23, 2009 @ 12:28 am
Probably the coiner of the word was aware of the modern Greek usage, and picked it not only as more euphonious, but because it eventually became the general Greek term for buying things, not just fish.
Stephen Jones said,
July 23, 2009 @ 6:20 am
Strange; I'd just come across the word an hour ago in a comment on an article in the Guardian. And I hadn't bothered to check for its meaning.
Stephen Jones said,
July 23, 2009 @ 6:32 am
And of course there is the vile salt tax the British continued in India. Gandhi made a famous protest against it in 1931.
Martin Monahan said,
July 23, 2009 @ 7:03 am
I learnt this word from a student's essay I was marking a few months ago. I then used it with confidence in the next week's class. Ah, the legerdemain of academe.
Terry Collmann said,
July 27, 2009 @ 6:31 am
Stephen Jones: diegogarcity strikes again!
joanne salton said,
July 31, 2009 @ 1:40 am
Is it really possible to (essentially) know all the English words apart from chemical compounds?
For myself, when I browse the "Urban Dictionary", I'm happy to find one that I know!
joanne salton said,
July 31, 2009 @ 1:47 am
Apart from which, although I (for example) now know the word "diegogarcity" I fear that quite soon I will not know it anymore. (Unless perhaps it has the magical quality of exemplifying the quality it describes)
Supremacy Claus said,
December 17, 2009 @ 6:04 am
The most important instance of monopsony today is the health insurance industry, with only one or two companies available in a market. They set payments to doctors too low for their own profits, and drive them out of business. They build up massive cash reserves. Meanwhile many units of health care have to close.