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Labor Market Integration, Unemployment, and Transfers

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  • Spilimbergo, Antonio

Abstract

Integration of the labor markets between a rich country (North) and a poor country (South) often leads to high unemployment in the South and transfers from North to South; for instance: United States versus Puerto Rico, West versus East Germany, Northern versus Southern Italy. This paper presents a general equilibrium model in which workers finance a transfer to the unemployed in the South in order to limit migration. In addition, it extends the framework to consider: the difference in efficiency between natives and immigrants, taxes on fixed factors in the North with internal transfers, and subsidies to the employed in the South. Copyright 1999 by Blackwell Publishing Ltd.

Suggested Citation

  • Spilimbergo, Antonio, 1999. "Labor Market Integration, Unemployment, and Transfers," Review of International Economics, Wiley Blackwell, vol. 7(4), pages 641-650, November.
    • Handle: RePEc:bla:reviec:v:7:y:1999:i:4:p:641-50
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    Cited by:

    1. Giuseppe Bertola & Francine Blau & Lawrence Kahn, 2007. "Labor market institutions and demographic employment patterns," Journal of Population Economics, Springer;European Society for Population Economics, vol. 20(4), pages 833-867, October.
    2. Nannan Yu & Tianhang Cui & Si Lv, 2023. "Does the High-Speed Rail Improve Employment in Peripheral Cities? Evidence From China’s Beijing–Shanghai HSR Line," SAGE Open, , vol. 13(4), pages 21582440231, December.
    3. Spilimbergo, Antonio & Ubeda, Luis, 2004. "A model of multiple equilibria in geographic labor mobility," Journal of Development Economics, Elsevier, vol. 73(1), pages 107-123, February.
    4. Maria Enchautegui & Richard B. Freeman, 2005. "Why Don't More Puerto Rican Men Work? The Rich Uncle (Sam) Hypothesis," NBER Working Papers 11751, National Bureau of Economic Research, Inc.
    5. Paolo Epifani, 1998. "Globalization and Regional Unemployment Divergence in the EU Countries," LIUC Papers in Economics 59, Cattaneo University (LIUC).

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