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The costs of dualism

Author

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  • Temple, Jonathan

    (Unifversity of Bristol)

Abstract

This paper shows how to calibrate a two-sector general equilibrium model of production using a small number of parameter assumptions and readily available data. The framework is then used to analyze the costs of labor market dualism. The paper quantifies the effects of rural-urban wage differentials and urban unemployment on total output, wages and returns to capital, factor shares, and sectoral structure. One of the main findings is that labor market rigidities can have a major impact on the extent of industrialization.

Suggested Citation

  • Temple, Jonathan, 2003. "The costs of dualism," Royal Economic Society Annual Conference 2003 201, Royal Economic Society.
    • Handle: RePEc:ecj:ac2003:201
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    Cited by:

    1. is not listed on IDEAS
    2. Areendam Chanda & Carl-Johan Dalgaard, 2003. "Dual Economies and International Total Factor Productivity Differences," EPRU Working Paper Series 03-09, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.

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    Keywords

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    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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