Question : 2. Monopsony is a market condition in which there is only one buyer.

Why
monopsony is not good for labour market?

Answer :

The reason PLN is categorized as a monopoly market is as follows.

PLN is the sole operator of electricity generation and distribution in Indonesia. Apart from
PLN, there are no business actors who do the same thing.

The PLN monopoly is not without cause. Regulations in Indonesia stipulate that electricity is
a matter that concerns the lives of many people. As a result, the management must be carried
out by BUMN. This is in accordance with the constitutional mandate.

PLN is included in the type of pure monopoly. This is shown because PT. PLN is the sole
seller or producer, the product is unique and without close substitutes, and its ability to
charge whatever price they want, and other traders cannot enter it.

The government's reasons for granting monopoly rights to PLN are as follows. Monopoly
rights are given as a form of implementation of the mandate of the Constitution regarding the
management of natural resources controlled by the state. Monopoly rights are given so that
the government can manage the amount of electricity tariffs that must be borne by the
community.