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Public infrastructure provision and skilled–unskilled wage inequality in developing countries

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  • Pi, Jiancai
  • Zhou, Yu
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    Abstract

    In this paper, we develop several static three-sector general equilibrium models with diverse labor market structures to investigate the effects of government provision of public infrastructure on the skilled–unskilled wage inequality in developing countries. The basic full employment model shows that the production sectors' relative dependence on the public infrastructure provision plays a crucial role in determining the skilled–unskilled wage inequality. Different relative dependences on public infrastructure may even result in opposite changes in the skilled–unskilled wage inequality. The above results are robust even when we extend the basic full employment model to three fundamentally different cases.

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    Bibliographic Info

    Article provided by Elsevier in its journal Labour Economics.

    Volume (Year): 19 (2012)
    Issue (Month): 6 ()
    Pages: 881-887

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    Handle: RePEc:eee:labeco:v:19:y:2012:i:6:p:881-887

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    Web page: http://www.elsevier.com/locate/labeco

    Related research

    Keywords: Public infrastructure; Skilled labor; Unskilled labor; Wage inequality; Labor market structure;

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    References

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    Cited by:
    1. Pan, Lijun & Zhou, Yu, 2013. "International factor mobility, environmental pollution and skilled–unskilled wage inequality in developing countries," Economic Modelling, Elsevier, vol. 33(C), pages 826-831.
    2. Pi, Jiancai & Zhou, Yu & Yin, Jun, 2013. "International factor mobility, monopolistic competition, and wage inequality," Economic Modelling, Elsevier, vol. 33(C), pages 326-332.
    3. L. Alan Winters, 2014. "Globalization, Infrastructure, and Inclusive Growth," Development Economics Working Papers 23974, East Asian Bureau of Economic Research.
    4. Pi, Jiancai & Zhou, Yu, 2013. "Institutional quality and skilled–unskilled wage inequality," Economic Modelling, Elsevier, vol. 35(C), pages 356-363.
    5. Pi, Jiancai & Zhou, Yu, 2014. "Foreign capital, public infrastructure, and wage inequality in developing countries," International Review of Economics & Finance, Elsevier, vol. 29(C), pages 195-207.

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