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Sub -optimal Tariff Policy and Gains from Trade for LDCs with Urban Unemployment

  • M. ALI KHAN

    (Hopkins University, Baltimore, Maryland)

  • PO-SHENG LIN

    (Hopkins University, Baltimore, Maryland)

In this paper we examine the issue of gains from trade in a setting which admits urban unemployment and a variety of urban, labour market conditions. In addition to the conventional criterion, we also consider the case when the size of the urban unemployed is the sole determinant of welfare. The results lean heavily on factor market stability and are sensitive to the commodity being imported and to the assumption of intersectoral mobility of capital.

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File URL: http://www.pide.org.pk/pdf/PDR/1982/Volume2/105-126.pdf
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Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

Volume (Year): 21 (1982)
Issue (Month): 2 ()
Pages: 105-126

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Handle: RePEc:pid:journl:v:21:y:1982:i:2:p:105-126
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  1. Jones, Ronald W, 1971. "Distortions in Factor Markets and the General Equilibrium Model of Production," Journal of Political Economy, University of Chicago Press, vol. 79(3), pages 437-59, May-June.
  2. J. N. Bhagwati & V. K. Ramaswami & T. N. Srinivasan, 1968. "Domestic Distortions, Tariffs and the Theory of Optimum Subsidy: Some Further Results," Working papers 29, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. J. N. Bhagwati & M. C. Kemp, 1968. "Ranking of Tariffs Under Monopoly Power in Trade," Working papers 31, Massachusetts Institute of Technology (MIT), Department of Economics.
  4. 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.
  5. Brecher, Richard A., 1974. "Optimal commercial policy for a minimum-wage economy," Journal of International Economics, Elsevier, vol. 4(2), pages 139-149, May.
  6. Kemp, Murray C & Nagishi, Takashi, 1969. "Domestic Distortions, Tariffs, and the Theory of Optimum Subsidy," Journal of Political Economy, University of Chicago Press, vol. 77(6), pages 1011-13, Nov./Dec..
  7. Srinivasan, T. N. & Bhagwati, Jagdish, 1975. "Alternative policy rankings in a large, open economy with sector-specific, minimum wages," Journal of Economic Theory, Elsevier, vol. 11(3), pages 356-371, December.
  8. Neary, J Peter, 1981. "On the Harris-Todaro Model with Intersectoral Capital Mobility," Economica, London School of Economics and Political Science, vol. 48(191), pages 219-34, August.
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