Capital Specificity, Imperpect Labor Mobility and Growth in Developing Economics

Document Type

Article

Journal/Book Title/Conference

International Review of Economic and Finance

Volume

18

Publication Date

2009

First Page

113

Last Page

122

Abstract

Labor markets in developing economies may be afflicted by a multiplicity of interacting distortions. We consider a general equilibrium model of an economy distorted by both sector-specific sticky wages and imperfect mobility of labor. In this framework, we contrast the implications of capital accumulation in the short and long run. We show that, in contrast to both the case in the absence of a sector-specific sticky wage and the case in the absence of imperfect labor mobility, the short and long-run effects of growth on the economic system converge as the degree of labor mobility is limited.

This document is currently not available here.

Share

COinS