Recessionary shock and factor return in an underemployed economy
AbstractThis paper builds a general equilibrium model for a small open economy with unemployment of unskilled labor to assess the impact of a recessionary shock. It is shown that irrespective of the factor intensity assumption skilled wage and rental ratio goes up if recession led price fall is significant. However, when the price fall is not sufficiently big, factor intensity assumption becomes crucial for the eventual effect on factors’ return ration.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 33733.
Date of creation: 2011
Date of revision:
International Trade; General Equilibrium;
Find related papers by JEL classification:
- D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-10-09 (All new papers)
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.:
- Mandal, Biswajit & Marjit, Sugata & Beladi, Hamid, 2010. "Recessionary shock, capital mobility and the informal sector," MPRA Paper 33736, University Library of Munich, Germany, revised Jan 2011.
- Ronald W. Jones, 1965. "The Structure of Simple General Equilibrium Models," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 73, pages 557.
- Chaudhuri, Sarbajit, 2009. "Economic Recession and Informal Sector Workers," MPRA Paper 18033, University Library of Munich, Germany.
- Marjit, Sugata & Kar, Saibal & Chaudhuri, Sarbajit, 2011.
"Recession in the skilled sector and implications for informal wage,"
Research in Economics, Elsevier,
Elsevier, vol. 65(3), pages 158-163, September.
- Marjit, Sugata & Chaudhuri, Sarbajit & Kar, Saibal, 2009. "Recession in the Skilled Sector and Implications for Informal Wage," MPRA Paper 18003, University Library of Munich, Germany.
- Leiderman,Leonardo & Razin,Assaf (ed.), 2010. "Capital Mobility," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521142731.
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