Bargaining Power

Bargaining Power is the ability for firms or workers to get what they want.

An example of bargaining power is related to the power of trades unions. If a single worker works for a monoposonistic employer is bargaining power is very weak and he is likely to get paid a low salary.

However, if workers join a trade union and achieve 100% density (i.e. everyone in the firm joins) then they have the capacity to influence the wage making process.