In an ordinary employer-employee relationship with a large
company, the employer has most of the power. When any individual
employee seeks a higher wage, he or she has no leverage; for a
large company to lose a single employee makes little difference.
In the U.S., unions have been a way for employees to get more
leverage. The large company can not ignore the effect of many
employees working together. However, many people dislike unions,
because unions are only effective when the union members work
together. Many people feel that this takes away individual
rights, as indeed it does. It recently occurred to me that there
is a different way to look at the issue. Think of the union as a
company itself, a special sort of company which operates as a
monopsony. When you join the employer, you are actually joining
two companies: the employer and the company which provides
employees to the employer. The union company and the regular
company have a tight relationship, but this is no different from
an ordinary monopsony