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International Migration of Labour and Skilled-Unskilled Wage Inequality

Author

Listed:
  • Shigemi Yabuuchi

    (Nagoya City University, Japan)

  • Sarbajit Chaudhuri

    (Calcutta University, India)

Abstract

The present note develops a three sector general equilibrium structure with diverse trade pattern and imperfection in the unskilled labour market to analyze the consequences of international mobility of skilled and unskilled labour on the skilled-unskilled wage inequality in the developing economies. The analysis finds that an emigration (immigration) of either type of labour is likely to produce a favourable (an unfavourable) effect on the wage inequality. In particular, the result of emigration (immigration) of skilled labour on the relative wage inequality is counterintuitive. These results have important policy implications for an overpopulated developing country like India.

Suggested Citation

  • Shigemi Yabuuchi & Sarbajit Chaudhuri, 2005. "International Migration of Labour and Skilled-Unskilled Wage Inequality," International Trade 0510007, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpit:0510007
    Note: Type of Document - pdf; pages: 10
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/it/papers/0510/0510007.pdf
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    References listed on IDEAS

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    1. Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," The World Bank Economic Review, World Bank, vol. 11(1), pages 33-57, January.
    2. Robert C. Feenstra & Gordon H. Hanson, 1995. "Foreign Investment, Outsourcing and Relative Wages," NBER Working Papers 5121, National Bureau of Economic Research, Inc.
    3. Jones, Ronald W. & Peter Neary, J., 1984. "The positive theory of international trade," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 1, pages 1-62, Elsevier.
    4. Sugata Marjit & Hamid Beladi & Avik Chakrabarti, 2004. "Trade and Wage Inequality in Developing Countries," Economic Inquiry, Western Economic Association International, vol. 42(2), pages 295-303, April.
    5. Sarbajit Chaudhuri, 2003. "How and how far to liberalize a developing economy with informal sector and factor market distortions," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 12(4), pages 403-428.
    6. Azizur Rahman Khan, 1998. "The Impact of Globalization on South Asia," Palgrave Macmillan Books, in: A. S. Bhalla (ed.), Globalization, Growth and Marginalization, chapter 4, pages 103-124, Palgrave Macmillan.
    7. Marjit, Sugata & Kar, Saibal, 2005. "Emigration and wage inequality," Economics Letters, Elsevier, vol. 88(1), pages 141-145, July.
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    Cited by:

    1. Chaudhuri, Sarbajit & Bandopadhyay, Titas Kumar, 2012. "Endogenous skill formation, foreign capital and education subsidy in a dual economy," MPRA Paper 41631, University Library of Munich, Germany.
    2. Chaudhuri, Sarbajit, 2010. "Economic recession, demand constraint and labour markets in a developing economy," MPRA Paper 27433, University Library of Munich, Germany.

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    More about this item

    Keywords

    Skilled labour; unskilled labour; wage inequality; emigration (immigration) of labour; labour market imperfection; diverse trade pattern;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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