Hi
Just wondered, if Corbyn managed to get in to number 10 what a national railway would mean for staff interns of pay and working conditions? Any thoughts?
It is generally considered that monopolies are not good for the economy, in other words for the population, taken as whole. Monopolies do not have to be nation-wide, for all sorts of reasons they can be geographically local and for a particular good or service effectively the only supplier. The same can be true of expensive technical kit - there is only one supplier with a suitable product. Monopolies tend to over-charge and offer less than would be the case if competition existed between the suppliers. There are roomfuls of studies and academic papers which demonstrate this effect — it is real.
Monopolies also work at the other end of the market - there can be a situation where there is only one employer. The technical term for a monopoly employer is 'monopsony' - a single purchaser. A monopoly employer in an industry always pays less than the going rate in an open market.
If Corbyn gets his way this would be the case for people working on the railways.
Following any nationalisation of the railways there will be continual Treasury pressure to minimise public spending to reduce the load on the taxpayer - regardless of what the politicians are offering at the moment. The wages, salaries and working conditions won't be immediately affected - but after ten years or so there will be a noticeable difference compared to now and to the open market.
One of the reasons NHS salaries, for example, are low compared to outside industry (although the pension scheme is good) is that it is a monopsony - there is only one employer. The increase in railway wages and salaries since BR was abolished is due to the competitive market that was created for scarce skills.
