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Capital specificity, imperfect labor mobility and growth in developing economies

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  • Gilbert, John
  • Oladi, Reza

Abstract

Labor markets in developing economies may be afflicted by a multiplicity of interacting distortions. We consider a general equilibrium model of an economy distorted by both sector-specific sticky wages and imperfect mobility of labor. In this framework, we contrast the implications of capital accumulation in the short and long run. We show that, in contrast to both the case in the absence of a sector-specific sticky wage and the case in the absence of imperfect labor mobility, the short and long-run effects of growth on the economic system converge as the degree of labor mobility is limited.

Suggested Citation

  • Gilbert, John & Oladi, Reza, 2009. "Capital specificity, imperfect labor mobility and growth in developing economies," International Review of Economics & Finance, Elsevier, vol. 18(1), pages 113-122, January.
  • Handle: RePEc:eee:reveco:v:18:y:2009:i:1:p:113-122
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Ravi Batra & Hamid Beladi & Reza Oladi, 2013. "Technical Progress and Real Wages Once again," Review of International Economics, Wiley Blackwell, vol. 21(3), pages 506-518, August.
    2. Beladi, Hamid & Chao, Chi-Chur, 2010. "Downsizing, wage inequality and welfare in a developing economy," Research in Economics, Elsevier, vol. 64(4), pages 224-228, December.
    3. Hamid Beladi & Sugata Marjit & Xinpeng Xu, 2011. "Protection, Involuntary Self‐Employment And Welfare," The Japanese Economic Review, Japanese Economic Association, vol. 62(2), pages 184-195, June.
    4. Pi Jiancai & Yin Jun, 2016. "Privatization, Unemployment, and Welfare in the Harris-Todaro Model with a Mixed Duopoly," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(4), pages 1-12, October.
    5. Ravi Batra & Hamid Beladi, 2013. "Foreign Capital and Urban Congestion in Emerging Markets," Review of Development Economics, Wiley Blackwell, vol. 17(4), pages 676-684, November.
    6. Beladi, Hamid & Marjit, Sugata & Broll, Udo, 2011. "Capital mobility, skill formation and polarization," Economic Modelling, Elsevier, vol. 28(4), pages 1902-1906, July.
    7. Hamid Beladi & Chi-Chur Chao & Daniel Hollas, 2013. "Does globalization weaken labor unions in developing countries?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 22(4), pages 562-571, June.
    8. Hamid Beladi & Chi-chur Chao & Daniel Hollas, 2011. "Fair wages, Urban Unemployment and Welfare in a Developing Economy," Economics Bulletin, AccessEcon, vol. 31(1), pages 273-285.
    9. Beladi, Hamid & Marjit, Sugata & Weiher, Kenneth, 2011. "An analysis of the demand for skill in a growing economy," Economic Modelling, Elsevier, vol. 28(4), pages 1471-1474, July.

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