Minimum Wage And Income Distribution In Developing Countries
AbstractThe purpose of this paper is to examine the effects of a change in the minimum wage on income distribution and employment in a developing economy. The basic framework of our analysis is the original Harris- Todaro model, in which the only factor that is intersectorally mobile is labor. We analyze the effects of a change in the minimum wage on income distribution, sectoral employment and unemployment, both in the framework of a small open economy, and with endogenous commodity-price changes. Our findings differ from the results of the existing literature and shed light on the complex interaction between the urban and the rural sector of a developing economy.
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Bibliographic InfoPaper provided by EconWPA in its series International Trade with number 0404005.
Length: 18 pages
Date of creation: 06 Apr 2004
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Note: Type of Document - pdf; pages: 18
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minimum wage; economies of scale; urban unemployment;
Find related papers by JEL classification:
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-04-11 (All new papers)
- NEP-DEV-2004-04-11 (Development)
- NEP-GEO-2004-04-11 (Economic Geography)
- NEP-LAB-2004-04-11 (Labour Economics)
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.:
- Jai-Young Choi, 1999. "Factor Growth, Urban Unemployment and Welfare Under Variable Returns to Scale," International Economic Journal, Taylor & Francis Journals, vol. 13(4), pages 17-34.
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- Corden, W M & Findlay, Ronald, 1975. "Urban Unemployment, Intersectoral Capital Mobility and Development Policy," Economica, London School of Economics and Political Science, vol. 42(165), pages 59-78, February.
- Neary, J Peter, 1981. "On the Short-Run Effects of Technological Progress," Oxford Economic Papers, Oxford University Press, vol. 33(2), pages 224-33, July.
- Neary, J Peter, 1978. "Short-Run Capital Specificity and the Pure Theory of International Trade," Economic Journal, Royal Economic Society, vol. 88(351), pages 488-510, September.
- Ucal, Meltem & Bilgin, Mehmet Huseyin, 2009. "Income Inequality and FDI in Turkey: FM-OLS (Phillips-Hansen) Estimation and ARDL Approach to Cointegration," MPRA Paper 48765, University Library of Munich, Germany.
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