Rising wage inequality in developing economies: Privatization and competition
AbstractUsing a dual structure depicting a developing economy, this paper shows that increased partial privatization or foreign competition can lead to wage inequality between skilled and unskilled labor. In addition, rising wage inequality can be triggered by inflows of unskilled labor or outflows of skilled labor and/or capital. Further, partial privatization or foreign competition reduces the urban output, thereby raising the goods price and unemployment ratio. These effects lower social welfare of the economy.
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Bibliographic InfoArticle provided by Taylor and Francis Journals in its journal The Journal of International Trade & Economic Development.
Volume (Year): 15 (2006)
Issue (Month): 3 ()
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