The dictionary will tell you that an oligopsony is a situation where demand for a product comes from a very small group of people.
An obvious example might seem to be crowns:
Crown of King Christian IV of Denmark. Photo by Ikiwaner
but an oligopsony doesn't really work in that way. An oligopsony is really when there are lots of people producing a product, but only a very few people to whom they can sell it.
Publishing is like that at the moment: there are a few very large publishers (who run lots of imprints, which disguises the fact that there are so few of them), and they publish the majority of books. This means that writers don't have too much choice about where to sell their work. The American tobacco industry works in a similar way, as do supermarkets in Britain. The producers have nowhere outside the oligopsony to sell their products, and so they have to accept the prices offered by this small group of purchasers.
No prizes for guessing that these are generally only just high enough to stop the producers from going out of business.
Well they are if the producers are lucky, anyway.
Word To Use Today: oligopsony. This word comes from the Greek olígos, meaning little or few (as in, coincidentally, the scruples of the purchasers) and the other Greek word opsōnia, which means purchase of food.
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