This article first appeared in the Planet Money newsletter.
I’m starting a new book that makes a provocative case about why income inequality soared in the United States and what can be done about it. The idea at its center made me think about the labor economics of the movie Alien.
Alien, the sci-fi horror classic starring Sigourney Weaver, dramatizes an extreme version of a common workplace problem. In the franchise backstory a British company and a Japanese firm merged into the multinational Weyland-Yutani, a sprawling conglomerate with clout across space. In the original film Ripley and the crew of the USCSS Nostromo are effectively truck drivers hauling ore for that corporation. On their way home the ship picks up a mysterious signal and the company reroutes them to investigate.
The crew protests and wants to go home. One crew member—an android secretly loyal to the company—cites the fine print in their contract: they must investigate such signals or surrender pay. With no bargaining power and no outside options, the workers comply. The detour leads to alien eggs, a facehugger infects a crew member, and Ripley urges quarantining the infected crewmember. Company loyalists override safety to retrieve the specimen because their orders are explicit: study the alien for weapons, and other considerations come second; the crew is expendable. The rest unfolds as horror, but the company’s callous calculus reads like a nightmarish workers’ compensation case.
Economically, Weyland-Yutani is an exaggerated monopsony. A monopsony is the flip side of a monopoly: instead of one seller dominating the market, it’s one buyer. For labor, that buyer is the employer. When a single employer or a few dominant employers control hiring in a place and workers have few alternatives, those employers gain the power to set wages and working conditions. Economists long treated monopsony as an exception—think remote company towns—but newer research shows employer market power is much more widespread.
In The Wage Standard: What’s Wrong in the Labor Market and How to Fix It, economist Arindrajit Dube surveys this growing literature and argues that monopsony power is pervasive. His use of the term covers situations where employers face weak competition for workers, not necessarily being the only employer but having enough leverage to underpay or mistreat employees.
That perspective challenges the old free-market assumption that labor markets are broadly competitive and self-correcting. If employers routinely exercise hiring and wage-setting power, then society needs counterweights: minimum wages, antitrust enforcement, public scrutiny, business norms of fairness, and strong unions. Since many of those checks have weakened since the early 1980s—declining union density, stagnant minimum wages, corporate shifts away from employee ownership—employer power has grown and helped drive inequality.
Dube’s account is not all pessimism. He highlights recent policy and institutional changes that could be revitalized or reimagined to blunt employer power and restore more balanced labor markets.
Next week’s Planet Money newsletter will dig deeper into The Wage Standard, the intellectual history of monopsony, and why Dube believes market power among employers helps explain rising inequality. If you aren’t subscribed, consider signing up for future issues.