Currency devaluation with dual labor market : Which perspectives for the Euro Zone ?
In this paper, we assume a world of two countries in a fixed exchange rate system. The main difference between the two countries lies in the features of their labor markets. In the home country, we assume the existence of a dual labor market, with formal and informal sectors. In the foreign country, the labor market is homogeneous and characterized by a nominal wage rigidity. In this context, the situation of labor market in each country is not optimal through a misallocation of workers between sectors in domestic economy, and unemployment in foreign economy. Our article shows that a devaluation of domestic currency implies a fall in production in each country, an increase in unemployment in foreign economy and a worse reallocation of workers by a growth of informal sector in domestic economy.
|Date of creation:||2012|
|Contact details of provider:|| Postal: PEGE. 61, Aven. de la Forêt-Noire 67000 Strasbourg|
Phone: +33 3 68 85 20 69
Fax: +33 3 68 85 20 70
Web page: http://www.beta-umr7522.fr/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hazans, Mihails, 2011.
"Informal workers across Europe : evidence from 30 European countries,"
Policy Research Working Paper Series
5912, The World Bank.
- Hazans, Mihails, 2011. "Informal Workers across Europe: Evidence from 30 Countries," IZA Discussion Papers 5871, Institute for the Study of Labor (IZA).
- Friedrich Schneider, 2004.
"Shadow Economies around the World: What do we really know?,"
IAW Discussion Papers
16, Institut für Angewandte Wirtschaftsforschung (IAW).
- Schneider, Friedrich, 2005. "Shadow economies around the world: what do we really know?," European Journal of Political Economy, Elsevier, vol. 21(3), pages 598-642, September.
- Claudia Curi & Cinzia Daraio & Patrick Llerena, 2012.
"University technology transfer: how (in)efficient are French universities?,"
Cambridge Journal of Economics,
Oxford University Press, vol. 36(3), pages 629-654.
- Claudia Curi & Cinzia Daraio & Maria Patrick Llerena, 2012. "University Technology Transfer: How (in-)efficient are French universities?," DIS Technical Reports 2012-02, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
- Claudia Curi & Cinzia Daraio & Patrick Llerena, 2012. "University Technology Transfer: How (in-)efficient are French universities?," Working Papers of BETA 2012-02, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
- Dimitri G Demekas, 1990. "Labor Market Segmentation in a Two-Sector Model of An Open Economy," IMF Working Papers 90/33, International Monetary Fund.
- Olivier Cardi & Romain Restout, 2012.
"Unanticipated vs. Anticipated Tax Reforms in a Two-Sector Open Economy,"
Working Papers of BETA
2012-01, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
- Olivier Cardi & Romain Restout, 2014. "Unanticipated vs. Anticipated Tax Reforms in a Two-Sector Open Economy," Open Economies Review, Springer, vol. 25(2), pages 373-406, April.
- David Cook & Hiromi Nosaka, 2005.
"Dual labor markets and business cycles,"
Working Paper Series
2006-36, Federal Reserve Bank of San Francisco.
- Mattesini Fabrizio & Rossi Lorenza, 2007.
"Optimal monetary policy in economies with dual labor markets,"
0009, Department of Communication, University of Teramo.
- Mattesini, Fabrizio & Rossi, Lorenza, 2009. "Optimal monetary policy in economies with dual labor markets," Journal of Economic Dynamics and Control, Elsevier, vol. 33(7), pages 1469-1489, July.
- Mattesini Fabrizio & Rossi Lorenza, 2008. "Optimal monetary policy in economies with dual labor markets," wp.comunite 0037, Department of Communication, University of Teramo.
- Konstantinos POULIAKAS & Ioannis THEODOSSIOU, 2010. "Differences in the job satisfaction of high-paid and low-paid workers across Europe," International Labour Review, International Labour Organization, vol. 149(1), pages 1-29, 03.
When requesting a correction, please mention this item's handle: RePEc:ulp:sbbeta:2012-04. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.