IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v49y1996i1p257-270.html
   My bibliography  Save this article

Disparity in wages but not in returns to capital between rich and poor countries

Author

Listed:
  • Bardhan, Pranab

Abstract

One of the striking features of the international economy is that while the level of average wage rates in rich countries is many times that in poor countries, their average rates of return to capital seem to be roughly similar or the differences in them relatively very small. This cannot be fully explained away by the fact that capital is internationally much more mobile than labor. There is remarkably little movement of return-sensitive private capital between the richest and the poorest countries. In this paper we assume instead that factors of production are internationally immobile, and try to explain the observed asymmetry in the pattern of factor prices in terms of particular types of differences in production functions between rich and poor countries, in terms of differential learning effects and differential degrees of specialization in the sector producing intermediate inputs and services.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Bardhan, Pranab, 1996. "Disparity in wages but not in returns to capital between rich and poor countries," Journal of Development Economics, Elsevier, vol. 49(1), pages 257-270, April.
  • Handle: RePEc:eee:deveco:v:49:y:1996:i:1:p:257-270
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/0304-3878(95)00061-5
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Lucas, Robert E, Jr, 1990. "Why Doesn't Capital Flow from Rich to Poor Countries?," American Economic Review, American Economic Association, vol. 80(2), pages 92-96, May.
    2. M. A. M. Smith, 1976. "International Trade Theory in Vintage Models," Review of Economic Studies, Oxford University Press, vol. 43(1), pages 99-113.
    3. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
    4. Rodriguez-Clare, Andres, 1996. "The division of labor and economic development," Journal of Development Economics, Elsevier, vol. 49(1), pages 3-32, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Maurice Obstfeld, 1993. "International Capital Mobility in the 1990s," NBER Working Papers 4534, National Bureau of Economic Research, Inc.
    2. Feeney, JoAnne, 1999. "International risk sharing, learning by doing, and growth," Journal of Development Economics, Elsevier, vol. 58(2), pages 297-318, April.
    3. James H. Anderson, 2002. "The Distribution Sector and the Development Process: are there Patterns? Yes," Economic Inquiry, Western Economic Association International, vol. 40(2), pages 166-176, April.

    More about this item

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:49:y:1996:i:1:p:257-270. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/devec .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.