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On-The-Job Search, Urban Informal Sector And The Development Policies-A General Equilibrium Analysis Author info | Abstract | Publisher info | Download info | Related research | Statistics Titas Bandopadhyay (Bagnan College)
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The purpose of this paper is to examine the Fields (1989) proposition1 in a multi sector general equilibrium model with perfect and imperfect capital mobility2. The effects of different fiscal policies on the equilibrium rate of urban unemployment are also examined here3. The main findings are more efficient on-the-job search from the rural sector raises equilibrium urban unemployment rate whereas increased job search efficiency from the urban informal sector lowers this rate. Again urban subsidy policy lowers the equilibrium urban unemployment rate and rural subsidy policy raises this rate. Urban formal sector enlargement leads to a change in ex-ante and ex-post labour force in the rural sector even if urban informal sector wage rate is constant. All the results are obtained both in the case of perfect and imperfect capital mobility.
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Paper provided by EconWPA in its series GE, Growth, Math methods with number
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Date of creation: 05 Nov 2005Date of revision:
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Keywords: job search informal sector development policy Find related papers by JEL classification: C6 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming D5 - Microeconomics - - General Equilibrium and Disequilibrium D9 - Microeconomics - - Intertemporal Choice and Growth
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