Optimal Urban Employment Policies: Notes on Calvo and Quibria
We show that Quibria's insightful observation on the efficacy of urban policy in a model with an urban trade union and an urban informal sector holds, but with a revenue-neutral employment tax-subsidy combination levied on the urban employer. We also draw the relevance of the generalized Harris-Todaro model in providing intuition for the validity of this surprising result.
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Volume (Year): 42 (2001)
Issue (Month): 2 (May)
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