IDEAS home Printed from https://ideas.repec.org/a/oup/oxecpp/v39y1987i2p378-87.html
   My bibliography  Save this article

Optimal Policies in a Dual Economy with Open Unemployment and Surplus Labour

Author

Listed:
  • Gang, Ira N
  • Gangopadhyay, Shubhashis

Abstract

This paper considers a dual economy in which the urban sector has open unemployment while the rural sector has surplus labor. The model is a n extension of the Harris-Todaro (1970) framework as developed by Kul B. Bhatia (1979), where full employment is said to exist when open u nemployment and surplus labor are eliminated. The authors characteriz e this full employment equilibrium and the conditions for technical e fficiency and, in addition, show the existence of a unique pair of op timal wage subsidies to each sector. Unlike the earlier uniform wage subsidies, they show that an optimal subsidy is not uniform across se ctors. Copyright 1987 by Royal Economic Society.

Suggested Citation

  • Gang, Ira N & Gangopadhyay, Shubhashis, 1987. "Optimal Policies in a Dual Economy with Open Unemployment and Surplus Labour," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 378-387, June.
    • Handle: RePEc:oup:oxecpp:v:39:y:1987:i:2:p:378-87
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0030-7653%28198706%292%3A39%3A2%3C378%3AOPIADE%3E2.0.CO%3B2-H&origin=bc
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
    ---><---

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

    Citations

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


    Cited by:

    1. Osman Suliman, 1999. "Indonesian Labour in Transition: An East Asian Success Story? By Chris Manning. Cambridge, UK: Cambridge University Press, 1998. Pp. xxii, 323. $59.95," Southern Economic Journal, John Wiley & Sons, vol. 65(3), pages 659-661, January.
    2. Khandker, A. Wahhab & Rashid, Salim, 1995. "Wage subsidy and full-employment in a dual economy with open unemployment and surplus labor," Journal of Development Economics, Elsevier, vol. 48(1), pages 205-223, October.
    3. Ira N. Gang & Myeong-Su Yun, 2007. "Immigration Amnesty and Immigrant's Earnings," Research in Labor Economics, in: Immigration, pages 273-309, Emerald Group Publishing Limited.
    4. Ilhom Abdulloev & Ira N. Gang & John Landon-Lane, 2011. "Migration as a Substitute for Informal Activities: Evidence from Tajikistan," Working Papers 311, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    5. Amitava Krishna Dutt, 1989. "Sectoral Balance: A Survey," WIDER Working Paper Series wp-1989-056, World Institute for Development Economic Research (UNU-WIDER).
    6. Sugata Marjit & Biswajit Mandal, 2016. "International Trade, Migration and Unemployment – The Role of Informal Sector," Economics and Politics, Wiley Blackwell, vol. 28(1), pages 8-22, March.
    7. Ira N. Gang & Edward Tower, 1990. "Allocating Jobs under a Minimum Wage: Queues vs. Lotteries," The Economic Record, The Economic Society of Australia, vol. 66(3), pages 186-194, September.
    8. S.M. Turab Hussain, 2005. "Migration, Policy and Welfare in the Context of Developing Economies : A Simple Extended Family Approach," Development Economics Working Papers 22256, East Asian Bureau of Economic Research.
    9. Amarjyoti Mahanta, 2022. "The transition of labour in the presence of adaptation cost and labour market segmentation," Metroeconomica, Wiley Blackwell, vol. 73(1), pages 109-125, February.

    More about this item

    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:oup:oxecpp:v:39:y:1987:i:2:p:378-87. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/oep .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.