Domestic labor, foreign capital and national welfare
The competitive allocation of labor across different sectors of an economy may not be socially optimal when one sector uses foreign capital. We argue that a suitably designed government intervention is required to restrict the sectors to their optimal size and maximize national welfare. Such a policy internalizes the possibility of repatriation and reinvestment. We demonstrate the optimality of a minimum wage regulation.
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- Marjit, Sugata & Beladi, Seyed Abdolhamid, 1997.
"Protection and the gainful effects of foreign capital,"
Discussion Papers, Series II
334, University of Konstanz, Collaborative Research Centre (SFB) 178 "Internationalization of the Economy".
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"Labour-Market Aspects of Enclave-Led Growth,"
Canadian Journal of Economics,
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- Neary, J Peter & Ruane, Frances, 1985.
"International Capital Mobility, Shadow Prices and the Cost of Protection,"
CEPR Discussion Papers
58, C.E.P.R. Discussion Papers.
- Neary, Peter & Ruane, Frances P, 1988. "International Capital Mobility, Shadow Prices, and the Cost of Protection," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 29(4), pages 571-85, November.
- Hamid Beladi & Sugata Marjit, 1992.
"Foreign Capital and Protectionism,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 25(1), pages 233-38, February.
- Yu, Eden S. H. & Chi-Chur, Chao, 1996. "Are wholly foreign-owned enterprises better than joint ventures?," Journal of International Economics, Elsevier, vol. 40(1-2), pages 225-237, February.
- Brecher, Richard A. & Findlay, Ronald, 1983. "Tariffs, foreign capital and national welfare with sector-specific factors," Journal of International Economics, Elsevier, vol. 14(3-4), pages 277-288, May.
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