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The Micro-Economics of "Surplus Labour"

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  • Ranis, G.
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    Abstract

    This paper examines the apparent conflict between the classical assumption of a bargaining agricultural sector wage and the neo-classical assumption of a competitive wage in the context of a labour surplus developing economy. It concludes that the relatively inelastic supply of labour hours offered by low income small or landless farmers in the static micro-economic leisure/work context is perfectly consistent with the persistence for some time of an institutional real wage offered to the non-agricultural sector of the dual economy. Empirical evidence is brought to bear in support of that position.

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    Bibliographic Info

    Paper provided by Yale - Economic Growth Center in its series Papers with number 772.

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    Length: 17 pages
    Date of creation: 1997
    Date of revision:
    Handle: RePEc:fth:yalegr:772

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    Postal: U.S.A.; YALE UNIVERSITY, ECONOMIC GROWTH CENTER, YALE STATION NEW-HAVEN CONNECTICUT 06520 U.S.A
    Phone: (203) 432-3610
    Fax: (203) 432-3898
    Web page: http://www.econ.yale.edu/~egcenter/
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    Related research

    Keywords: WAGES ; FARMS ; DEVELOPING COUNTRIES;

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    Cited by:
    1. Haagh, Louise, 2011. "Working Life, Well-Being and Welfare Reform: Motivation and Institutions Revisited," World Development, Elsevier, vol. 39(3), pages 450-473, March.

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