Hospital Consolidation and Monopsony Power in the Labor Market for Nurses

The U.S. has faced a persistent nursing shortage since World War II. Monopsony power is often considered a contributing factor to this chronic shortage. In a market with few competitors and a supply of workers that experiences frictions to changing jobs, hospitals can increase profits by suppressing employment and wages below the competitive level. A wave of hospital consolidation in the U.S. over the last 30 years has only further reduced competition among nurses’ employers and expanded this