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Formation of SEZ, Agricultural Productivity and Urban Unemployment

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  • Chaudhuri, Sarbajit
  • Yabuuchi, Shigemi

Abstract

Formation of SEZ using agricultural land to promote industrialization has recently been one of most controversial policy issues in many developing economies including India. This paper critically theoretically evaluates the consequences of this policy in terms of a three-sector Harris-Todaro type general equilibrium model reasonable for a developing economy. It finds that agriculture and SEZ can grow simultaneously provided the government spends more than a critical amount on irrigation projects and other infrastructural development designed for improving the efficiency of land. Agricultural wage and aggregate employment in the economy may also improve.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 5324.

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Date of creation: 11 Oct 2007
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Handle: RePEc:pra:mprapa:5324

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Keywords: Special economic zone; fiscal concessions; agricultural productivity; rural wage; urban unemployment;

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  1. Ke Li & Jan Whitwell & Shuntian Yao, 2005. "A Growth Model For China'S Special Economic Zone," Pacific Economic Review, Wiley Blackwell, Wiley Blackwell, vol. 10(4), pages 439-449, December.
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Cited by:
  1. Mukherjee, Soumyatanu, 2011. "Special Economic Zones and Agriculture with Increasing Returns," MPRA Paper 33785, University Library of Munich, Germany.

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