What are the advantages of monopsonies to suppliers?

Suppliers are unaffected if they are a monopoly.

What are the disadvantages of monopsonies to suppliers?

Suppliers would see a decrease in revenue if monopsony power increases. This can also lead to suppliers having to shutdown.

What are the advantages of monopsonies to customers?

Monopsonies have lower costs, therefore they can provide lower prices to consumers.

What are the disadvantages of monopsonies to customers?

Customers may see a decrease in quality. As monopsonies squeeze suppliers, they may take shortcuts.

Y13 Microeconomics Notes

Monopsony | A-Level Economics Notes

Jaisul Naik

21 Apr 2026 • 1 min read

These revision notes cover everything you need to know about Monopsony for A-Level Economics. They're designed for students studying Edexcel A-Level Economics and Edexcel International A-Level Economics. Written by Jaisul Naik, UCL Economics graduate and A-Level Economics tutor since 2017.

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Please note that this is not needed for AQA students

What is a monopsony?

A monopsony is a firm that can exploit their market power when buying factors of production.

This allows them to under-pay and under-employ factors of production.