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Can International Factor Mobility lessen Wage Inequality in a Dual Economy?

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  • Beladi, Hamid
  • Chaudhuri, Sarbajit
  • Yabuuchi, Shigemi

Abstract

We introduce international labor mobility in a three-sector general equilibrium model with rural-urban migration. We demonstrate that under some reasonable conditions an inflow of foreign skilled labor (capital) can reduce skilled-unskilled wage inequality.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 2641.

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Date of creation: 03 Jan 2007
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Handle: RePEc:pra:mprapa:2641

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Keywords: Skilled-unskilled wage inequality; rural-urban migration; Unemployment; International factor movements;

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References

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  1. Sarbajit Chaudhuri, 2005. "Foreign Capital, Welfare And Urban Unemployment In The Presence Of Agricultural Dualism," International Trade 0510010, EconWPA.
  2. Chaudhuri, Sarbajit & Yabuuchi, Shigemi, 2007. "Economic liberalization and wage inequality in the presence of labour market imperfection," International Review of Economics & Finance, Elsevier, vol. 16(4), pages 592-603.
  3. Sugata Marjit & Hamid Beladi & Avik Chakrabarti, 2004. "Trade and Wage Inequality in Developing Countries," Economic Inquiry, Western Economic Association International, vol. 42(2), pages 295-303, April.
  4. Feenstra, R.C. & Hanson, G.H., 1995. "Foreign Investment, Outsourcing and Relative Wages," Papers 95-14, California Davis - Institute of Governmental Affairs.
  5. Yabuuchi, Shigemi & Chaudhuri, Sarbajit, 2007. "International migration of labour and skilled-unskilled wage inequality in a developing economy," Economic Modelling, Elsevier, vol. 24(1), pages 128-137, January.
  6. Shigemi Yabuuchi, 2007. "Unemployment and International Factor Movement in the Presence of Skilled and Unskilled Labor," Review of Development Economics, Wiley Blackwell, vol. 11(3), pages 437-449, 08.
  7. Marjit, Sugata & Kar, Saibal, 2005. "Emigration and wage inequality," Economics Letters, Elsevier, vol. 88(1), pages 141-145, July.
  8. Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, vol. 11(1), pages 33-57, January.
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Cited by:
  1. Chaudhuri, Sarbajit & Banerjee, Dibyendu, 2008. "Fair Wage Hypothesis, International Factor Mobility and Skilled-Unskilled Wage Inequality in a Developing Economy," MPRA Paper 9303, University Library of Munich, Germany.
  2. Chaudhuri, Sarbajit, 2008. "Fair Wage Hypothesis, Foreign Capital Inflow and Skilled-unskilled Wage Inequality in the Presence of Agricultural Dualism," MPRA Paper 9394, University Library of Munich, Germany.

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