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The Employment Effects of an Income Redistribution in Developing Countries

In: Technological Systems and Development

Author

Listed:
  • Jeffrey James

    (Tilburg University)

  • Haider A. Khan

    (University of Denver)

Abstract

The 1970 ILO Mission Report to Colombia first proposed the notion that since the poor tend to consume a more labour-intensive basket of commodities than the rich, a redistribution of income in their favour will tend to increase employment. This proposal gave rise to a host of attempts in the 1970s to demonstrate its empirical validity in a number of developing countries. The results however provided only a very limited degree of support to the ILO hypothesis. Indeed, by 1978 ‘the clear conclusion of the general equilibrium macroeconomic models’ was that ‘income redistribution would have only a tiny effect on employment’.1

Suggested Citation

  • Jeffrey James & Haider A. Khan, 1998. "The Employment Effects of an Income Redistribution in Developing Countries," Palgrave Macmillan Books, in: Technological Systems and Development, chapter 5, pages 87-104, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-26413-1_5
    DOI: 10.1007/978-1-349-26413-1_5
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    References listed on IDEAS

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    1. James, Jeffrey & Steward, Frances, 1981. "New Products: A Discussion of the Welfare Effects of the Introduction of New Products in Developing Countries," Oxford Economic Papers, Oxford University Press, vol. 33(1), pages 81-107, March.
    2. James, Jeffrey, 1980. "The employment effects of an income redistribution : A test for aggregation bias in the Indian sugar processing industry," Journal of Development Economics, Elsevier, vol. 7(2), pages 175-189, April.
    3. Frances Stewart, 1978. "Technology and Underdevelopment," Palgrave Macmillan Books, Palgrave Macmillan, edition 0, number 978-1-349-15932-1, December.
    4. White, Lawrence J, 1978. "The Evidence on Appropriate Factor Proportions for Manufacturing in Less Developed Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 27(1), pages 27-59, October.
    5. Khan, Haider A. & Thorbecke, Erik, 1989. "Macroeconomic effects of technology choice: Multiplier and structural path analysis within a SAM framework," Journal of Policy Modeling, Elsevier, vol. 11(1), pages 131-156.
    6. Morawetz, David, 1974. "Employment Implications of Industrialisation in Developing Countries: A Survey," Economic Journal, Royal Economic Society, vol. 84(335), pages 491-542, September.
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    Cited by:

    1. Jeffrey James & Haider A. Khan, 1998. "Technology Choice and Income Distribution," Palgrave Macmillan Books, in: Technological Systems and Development, chapter 6, pages 105-130, Palgrave Macmillan.
    2. Siddiqui, Rizwana & Iqbal, Zafar, 1999. "Salient features of social accounting matrix of Pakistan for 1989-90: Disaggregation of the households sector," MPRA Paper 4454, University Library of Munich, Germany.
    3. Schettino, Francesco & Gabriele, Alberto & Khan, Haider A., 2021. "Polarization and the middle class in China: A non-parametric evaluation using CHNS and CHIP data," Structural Change and Economic Dynamics, Elsevier, vol. 57(C), pages 251-264.
    4. Alvaro Gallardo & Cristian Mardones, 2013. "Environmentally extended social accounting matrix for Chile," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 15(4), pages 1099-1127, August.
    5. Khan, Haider & Schettino, Francesco, 2018. "Income Polarization in the USA (1983-2016): what happened to the middle class?," MPRA Paper 85554, University Library of Munich, Germany.
    6. Manfred Lenzen & Roberto Schaeffer, 2004. "Environmental and Social Accounting for Brazil," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 27(2), pages 201-226, February.
    7. Rizwana Siddiqui & Zafar Iqbal, 1999. "Social Accounting Matrix of Pakistan for 1989-90," PIDE Research Report 1999:171, Pakistan Institute of Development Economics.
    8. Zafar Iqbal & Rizwana Siddiqui, 1999. "Distributional Impact of Structural Adjustment on Income Inequality in Pakistan: A SAM-based Analysis," MIMAP Technical Paper Series 1999:02, Pakistan Institute of Development Economics.
    9. Zafar Iqbal & Rizwana Siddiqui, 1998. "The Impact of Structural Adjustment on Income Distribution in Pakistan A SAM-based Analysis," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 37(4), pages 377-397.
    10. Schettino, Francesco & Khan, Haider A., 2020. "Income polarization in the USA: What happened to the middle class in the last few decades?," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 149-161.
    11. James, M.J. & Khan, H., 1997. "Technology choice & income distribution," Other publications TiSEM 6f76a538-55bd-4a1b-bcbb-5, Tilburg University, School of Economics and Management.

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