IDEAS home Printed from https://ideas.repec.org/a/taf/jitecd/v11y2001i2p207-222.html
   My bibliography  Save this article

Specific and mobile capital, migration and unemployment in a Harris-Todaro model

Author

Listed:
  • Kul Bhatia

Abstract

Specific- and mobile-capital versions of the Harris-Todaro model are compared in a simple algebraic formulation. The former focuses on wage elasticity of demand in the minimum-wage ( M ) sector ( m M ), whereas the latter also considers elasticities of substitution ( † s). By relating m M and † M , similarities between the conclusions of the two models can be clearly obse M rved and M many of them can be restated as exogenous conditions on the substitution elasticities. A single † , for which econometric estimates are readily available, can drive some key results. Elasticity of substitution in the non-minimum-wage sector, which is rarely discussed in the literature because of its emphasis on the minimum-wage sector, plays an important part. Among the new results, in the mobile-capital formulation, 'large' values of this elasticity ( † A , for which precise, quantifiable expressions are derived) are sufficient to cause outmigration from the M -sector when the minimum wage is increased, irrespective of † M and m M . Numerical examples from a computable general equilibrium model for Mexico illustrate, and in some cases flesh out, some analytical propositions for both versions of the HT model in a small open economy.

Suggested Citation

  • Kul Bhatia, 2001. "Specific and mobile capital, migration and unemployment in a Harris-Todaro model," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 11(2), pages 207-222.
    • Handle: RePEc:taf:jitecd:v:11:y:2001:i:2:p:207-222
    DOI: 10.1080/09638190010110758
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/09638190010110758
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09638190010110758?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

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

    References listed on IDEAS

    as
    1. repec:bla:econom:v:48:y:1981:i:191:p:219-34 is not listed on IDEAS
    2. repec:bla:econom:v:55:y:1988:i:217:p:119-21 is not listed on IDEAS
    3. Murray Brown, 1967. "The Theory and Empirical Analysis of Production," NBER Books, National Bureau of Economic Research, Inc, number brow67-1.
    4. Cole, William E & Sanders, Richard D, 1985. "Internal Migration and Urban Employment in the Third World," American Economic Review, American Economic Association, vol. 75(3), pages 481-494, June.
    5. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    6. repec:bla:econom:v:42:y:1975:i:165:p:59-78 is not listed on IDEAS
    7. Stark, Oded & Ranjan Gupta, Manash & Levhari, David, 1991. "Equilibrium urban unemployment in developing countries : Is migration the culprit?," Economics Letters, Elsevier, vol. 37(4), pages 477-482, December.
    8. repec:bla:econom:v:55:y:1988:i:217:p:123-27 is not listed on IDEAS
    9. M. Hasan Imam & John Whalley, 1985. "Incidence Analysis of a Sector-Specific Minimum Wage in a Two-Sector Harris-Todaro Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 100(1), pages 207-224.
    10. Bhatia, Kul B, 1979. "Rural-Urban Migration and Surplus Labour," Oxford Economic Papers, Oxford University Press, vol. 31(3), pages 403-414, November.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Vassilis T. Rapanos, 2005. "Minimum Wage And Income Distribution In The Harris-Todaro Model," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 30(1), pages 1-14, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lall, Somik V. & Selod, Harris & Shalizi, Zmarak, 2006. "Rural-urban migration in developing countries : a survey of theoretical predictions and empirical findings," Policy Research Working Paper Series 3915, The World Bank.
    2. Ather Maqsood Ahmed & Ismail Sirageldin, 1993. "Socio-economic Determinants of Labour Mobility in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(2), pages 139-157.
    3. Mathan Satchi & Jonathan Temple, 2006. "Growth and labour markets in developing countries," Bristol Economics Discussion Papers 06/581, School of Economics, University of Bristol, UK.
    4. Amitava Krishna Dutt, 1989. "Sectoral Balance: A Survey," WIDER Working Paper Series wp-1989-056, World Institute for Development Economic Research (UNU-WIDER).
    5. Pekkala, Sari, 2002. "Regional growth centres - the most attractive location in Finland?," ERSA conference papers ersa02p087, European Regional Science Association.
    6. Clement Imbert & Marlon Seror & Yifan Zhang & Yanos Zylberberg, 2022. "Migrants and Firms: Evidence from China," American Economic Review, American Economic Association, vol. 112(6), pages 1885-1914, June.
    7. Subhasankar Chattopadhyay & Rima Mondal, 2017. "Characterisation of Economic Growth in Developing Economies with Informal Sector," Economic Papers, The Economic Society of Australia, vol. 36(1), pages 86-101, March.
    8. Masaharu Nagashima, 2018. "A condition for the reduction of urban unemployment in the Harris–Todaro model," Asia-Pacific Journal of Regional Science, Springer, vol. 2(1), pages 243-255, April.
    9. Katy Cornwell & Brett Inder, 2004. "Migration and Unemployment in South Africa: When Motivation Surpasses the Theory," Monash Econometrics and Business Statistics Working Papers 2/04, Monash University, Department of Econometrics and Business Statistics.
    10. Meyer, Susanne, 2003. "Sozialausgaben der OECD-Staaten: Ein Pull-Effekt der Migration?," Darmstadt Discussion Papers in Economics 124, Darmstadt University of Technology, Department of Law and Economics.
    11. Zenou, Yves, 2008. "Job search and mobility in developing countries. Theory and policy implications," Journal of Development Economics, Elsevier, vol. 86(2), pages 336-355, June.
    12. Meyer, Susanne, 2003. "Sozialausgaben in OECD-Staaten: Ein Pull-Effekt der Migration?," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 37303, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    13. Ana Paula Martins, 2011. "Compliance with the Institutional Wage in Dualistic Models," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 54(2), pages 93-126.
    14. Andrés Villarreal & Sarah Blanchard, 2013. "How Job Characteristics Affect International Migration: The Role of Informality in Mexico," Demography, Springer;Population Association of America (PAA), vol. 50(2), pages 751-775, April.
    15. Minh Quang Dao, 2010. "Factor Mobility, Net Migration, Growth and the Lot of the Poorest Quintile in Developing Countries," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 4(1), pages 127-137, January.
    16. Esa A. Asyahid & Elan Satriawan, 2024. "The Nature of Self-Employment in Indonesia: Entrepreneurship or Survival Strategy?," Gadjah Mada Economics Working Paper Series 202403002, Department of Economics, Faculty of Economics and Business, Universitas Gadjah Mada.
    17. Chaudhuri, Sarbajit, 2007. "Foreign capital, welfare and urban unemployment in the presence of agricultural dualism," Japan and the World Economy, Elsevier, vol. 19(2), pages 149-165, March.
    18. Titas Bandopadhyay, 2005. "Universal Education And Its Impact On The Child And The Adult Labour Market," GE, Growth, Math methods 0511002, University Library of Munich, Germany.
    19. Takao FUKUCHI, 1998. "A Simulation Analysis Of The Urban Informal Sector," The Developing Economies, Institute of Developing Economies, vol. 36(3), pages 225-256, September.
    20. Vassilis T. Rapanos, 2004. "Minimum Wage And Income Distribution In Developing Countries," International Trade 0404005, University Library of Munich, Germany.

    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:taf:jitecd:v:11:y:2001:i:2:p:207-222. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RJTE20 .

    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.