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Endogenous Skill Formation: Labor Market Integration by an Immigration

Author

Listed:
  • Bandopadhyay, Titas Kumar

    (Bagnan College, West Bangal, India,)

  • Chaudhuri, Sarbajit

    (University of Calcutta, Kolkata, India)

Abstract

The paper fabricates endogenous skill formation in a two-sector general equilibrium model where the unemployment of the skilled workers is caused by efficiency wage. The paper also examines the effects of the immigration of unskilled labor, the emigration of skilled labor, and the inflow of foreign capital on unemployment, skilled-unskilled wage inequality, and the level of skill formation in each unskilled working family. We find that the immigration of unskilled labor raises both the rate and level of unemployment of the skilled labor and lowers both the relative skilled-unskilled wage inequality and the level of skill formation in each unskilled working family under certain conditions. However, the emigration of skilled labor or the inflow of foreign capital gives opposite results.

Suggested Citation

  • Bandopadhyay, Titas Kumar & Chaudhuri, Sarbajit, 2013. "Endogenous Skill Formation: Labor Market Integration by an Immigration," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 28, pages 183-200.
    • Handle: RePEc:ris:integr:0596
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    More about this item

    Keywords

    Skill Formation; Wage Inequality; Unemployment; Skilled Labor;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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