A key feature of monopsony model is that a single firm pays its workers a wage ( w ) less than the marginal revenue product ( MRP ). This feature has been explained as a synonym of the single firm exploiting its workers since its creation by Joan Robinson [1]. By using a simple standard efficiency wage model of Yellen [2], this paper examines the conventional wisdom by showing that the firm pays workers w in the equilibrium of full employment, but paradoxically pays them w=MRP in the equilibrium of involuntary unemployment. According to the conventional wisdom that the result of w implies that workers are exploited by the firm, this f inding indicates that the firm does not exploit its employees ( w=MRP ) when there are involuntary unemployed workers queuing for jobs, but paradoxically exploits workers ( w ) when there are no workers queuing for jobs.

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