[ol-i-gop-suh-nee] 
| the market condition that exists when there are few buyers, as a result of which they can greatly influence price and other market factors. |
| ol·i·gop·so·ny (ŏl'ĭ-gŏp'sə-nē, ō'lĭ-) n. pl. ol·i·gop·so·nies A market condition in which purchasers are so few that the actions of any one of them can materially affect price and the costs that competitors must pay. [olig(o)- + (mon)opsony.] ol'i·gop'so·nis'tic (-nĭs'tĭk) adj. |
Oligopsony
Similar to an oligopoly (few sellers), this is a market in which there are only a few large buyers for a product or service. This allows the buyers to exert a great deal of control over the sellers and can effectively drive down prices.
Investopedia Commentary
A good example of an oligopsony would be the U.S. fast food industry, in which a small number of large buyers (i.e. McDonald's, Burger King, Wendy's) controls the U.S. meat market. Such control allows these fast food mega-chains to dictate the price they pay to farmers for meat and to influence animal welfare conditions and labor standards.
Related Links
Antitrust Defined
Economics Basics Tutorial
See also: Demand, Economics, Monopoly, Monopsony, Oligopoly, Supply
oligopsony
ɪˈgɒp