Ethnic Dualism and Communication Costs – Explaining Segmentation and Wage Inertia
AbstractWhat is the impact of international migration on the wage structure? Empirically, it is difficult to find any effect at all. This essay gives a new theoretical explanation for this conspicuous absence, emphasising non-convexities in the technology of individual firms due to communication costs. With high costs of coordination between workers, the labour force will segregate on the workshop level. In this case, the aggregate production technology has linear segments, and within certain bounds, additional labour input is absorbed without changing the relative factor prices. A local non-substitution theorem is derived.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre in its series Discussion Papers with number 593.
Date of creation: 2000
Date of revision:
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- D33 - Microeconomics - - Distribution - - - Factor Income Distribution
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Takayama,Akira, 1985. "Mathematical Economics," Cambridge Books, Cambridge University Press, number 9780521314985, October.
- Pischke, Jörn-Steffen & Velling, Johannes, 1994.
"Wage and Employment Effects of Immigration to Germany: An Analysis Based on Local Labour Markets,"
CEPR Discussion Papers
935, C.E.P.R. Discussion Papers.
- Pischke, J.S. & Velling, J., 1994. "Wages and Employment Effects of Immigration to Germany: An Analysis Based on Local Labor Markets," Working papers 94-08, Massachusetts Institute of Technology (MIT), Department of Economics.
- Pischke, Jörn-Steffen & Velling, Johannes, 1994. "Wage and employment effects of immigration to Germany: an analysis based on local labor markets," ZEW Discussion Papers 94-03, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Zimmermann, Klaus F, 1993.
"Native Wage Impacts of Foreign Labour: A Random Effects Panel Analysis,"
CEPR Discussion Papers
851, C.E.P.R. Discussion Papers.
- De New, John P & Zimmermann, Klaus F, 1994. "Native Wage Impacts of Foreign Labor: A Random Effects Panel Analysis," Journal of Population Economics, Springer, vol. 7(2), pages 177-92.
- McManus, Walter S, 1985. "Labor Market Costs of Language Disparity: An Interpretation of Hispanic Earnings Differences," American Economic Review, American Economic Association, vol. 75(4), pages 818-27, September.
- Grossman, Jean Baldwin, 1982. "The Substitutability of Natives and Immigrants in Production," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 596-603, November.
- Greenwood, Michael J & McDowell, John M, 1986. "The Factor Market Consequences of U.S. Immigration," Journal of Economic Literature, American Economic Association, vol. 24(4), pages 1738-72, December.
- Bauer, Thomas K. & Zimmermann, Klaus F., 1999. "Report No. 3: Assessment of Possible Migration Pressure and its Labour Market Impact Following EU Enlargement to Central and Eastern Europe," IZA Research Reports 3, Institute for the Study of Labor (IZA).
- Joseph G. Altonji & David Card, 1991. "The Effects of Immigration on the Labor Market Outcomes of Less-skilled Natives," NBER Chapters, in: Immigration, Trade and the Labor Market, pages 201-234 National Bureau of Economic Research, Inc.
- Walter S. McManus, 1990. "Labor Market Effects of Language Enclaves: Hispanic Men in the United States," Journal of Human Resources, University of Wisconsin Press, vol. 25(2), pages 228-252.
- Edward P. Lazear, 1999.
"Culture and Language,"
Journal of Political Economy,
University of Chicago Press, vol. 107(S6), pages S95-S126, December.
- Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, number 9780195102680.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Katharina Rautenberg).
If references are entirely missing, you can add them using this form.