Macroeconomic adjustment with segmented labor markets:
This paper analyzes the macroeconomic effects of fiscal and labor market policies in a small open developing country. The basic framework considers an economy with a large informal production sector and a heterogeneous work force. The labor market is segmented as a result of efficiency consideration...
Gespeichert in:
| Hauptverfasser: | , |
|---|---|
| Format: | Buch |
| Sprache: | English |
| Veröffentlicht: |
Cambridge, Mass.
1994
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| Schriftenreihe: | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series
4769 |
| Schlagworte: | |
| Zusammenfassung: | This paper analyzes the macroeconomic effects of fiscal and labor market policies in a small open developing country. The basic framework considers an economy with a large informal production sector and a heterogeneous work force. The labor market is segmented as a result of efficiency considerations and minimum wage laws. The basic model is then extended to account for unemployment benefits, income taxation, and imperfect labor mobility across sectors. Under the assumption of perfect labor mobility, we show that a permanent reduction in government spending on nontraded goods leads in the long run to a depreciation of the real exchange rate, a fall in the market-clearing wage for unskilled labor, an increase in output of traded goods, and a lower stock of net foreign assets. A permanent reduction in the minimum wage for unskilled workers improves competitiveness, and expands the formal sector at the expense of the informal sector. Hence, in a two-sector economy in which the minimum wage is enforced only in the formal sector and wages in one segment of the labor market are competitively determined, efficiency wage considerations do not alter the standard neoclassical presumption. A reduction in unemployment benefits is also shown to have a positive effect on output of tradable goods by lowering both the level of efficiency wages and the employment rent of skilled workers. |
| Beschreibung: | 42 S. graph. Darst. |
Internformat
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| 245 | 1 | 0 | |a Macroeconomic adjustment with segmented labor markets |c Pierre-Richard Agénor ; Joshua Aizenman |
| 264 | 1 | |a Cambridge, Mass. |c 1994 | |
| 300 | |a 42 S. |b graph. Darst. | ||
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| 490 | 1 | |a National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |v 4769 | |
| 520 | |a This paper analyzes the macroeconomic effects of fiscal and labor market policies in a small open developing country. The basic framework considers an economy with a large informal production sector and a heterogeneous work force. The labor market is segmented as a result of efficiency considerations and minimum wage laws. The basic model is then extended to account for unemployment benefits, income taxation, and imperfect labor mobility across sectors. Under the assumption of perfect labor mobility, we show that a permanent reduction in government spending on nontraded goods leads in the long run to a depreciation of the real exchange rate, a fall in the market-clearing wage for unskilled labor, an increase in output of traded goods, and a lower stock of net foreign assets. A permanent reduction in the minimum wage for unskilled workers improves competitiveness, and expands the formal sector at the expense of the informal sector. Hence, in a two-sector economy in which the minimum wage is enforced only in the formal sector and wages in one segment of the labor market are competitively determined, efficiency wage considerations do not alter the standard neoclassical presumption. A reduction in unemployment benefits is also shown to have a positive effect on output of tradable goods by lowering both the level of efficiency wages and the employment rent of skilled workers. | ||
| 650 | 7 | |a Arbeidsmarkt |2 gtt | |
| 650 | 7 | |a Belastingpolitiek |2 gtt | |
| 650 | 7 | |a Minimumlonen |2 gtt | |
| 650 | 4 | |a Arbeitsmarkt | |
| 650 | 4 | |a Mathematisches Modell | |
| 650 | 4 | |a Production functions (Economic theory) | |
| 650 | 4 | |a Unemployment |x Effect of fiscal policy on |x Mathematical models | |
| 650 | 4 | |a Unemployment |x Effect of manpower policy on |x Mathematical models | |
| 650 | 4 | |a Wages |x Effect of fiscal policy on |x Mathematical models | |
| 650 | 4 | |a Wages |x Effect of manpower policy on |x Mathematical models | |
| 700 | 1 | |a Aizenman, Joshua |d 1949- |e Verfasser |0 (DE-588)124080057 |4 aut | |
| 830 | 0 | |a National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |v 4769 |w (DE-604)BV002801238 |9 4769 | |
| 999 | |a oai:aleph.bib-bvb.de:BVB01-006551060 | ||
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| id | DE-604.BV009893562 |
| illustrated | Illustrated |
| indexdate | 2024-07-09T17:42:42Z |
| institution | BVB |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-006551060 |
| oclc_num | 30773016 |
| open_access_boolean | |
| owner | DE-19 DE-BY-UBM DE-521 |
| owner_facet | DE-19 DE-BY-UBM DE-521 |
| physical | 42 S. graph. Darst. |
| publishDate | 1994 |
| publishDateSearch | 1994 |
| publishDateSort | 1994 |
| record_format | marc |
| series | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| series2 | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| spelling | Agénor, Pierre-Richard 1957- Verfasser (DE-588)12408009X aut Macroeconomic adjustment with segmented labor markets Pierre-Richard Agénor ; Joshua Aizenman Cambridge, Mass. 1994 42 S. graph. Darst. txt rdacontent n rdamedia nc rdacarrier National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 4769 This paper analyzes the macroeconomic effects of fiscal and labor market policies in a small open developing country. The basic framework considers an economy with a large informal production sector and a heterogeneous work force. The labor market is segmented as a result of efficiency considerations and minimum wage laws. The basic model is then extended to account for unemployment benefits, income taxation, and imperfect labor mobility across sectors. Under the assumption of perfect labor mobility, we show that a permanent reduction in government spending on nontraded goods leads in the long run to a depreciation of the real exchange rate, a fall in the market-clearing wage for unskilled labor, an increase in output of traded goods, and a lower stock of net foreign assets. A permanent reduction in the minimum wage for unskilled workers improves competitiveness, and expands the formal sector at the expense of the informal sector. Hence, in a two-sector economy in which the minimum wage is enforced only in the formal sector and wages in one segment of the labor market are competitively determined, efficiency wage considerations do not alter the standard neoclassical presumption. A reduction in unemployment benefits is also shown to have a positive effect on output of tradable goods by lowering both the level of efficiency wages and the employment rent of skilled workers. Arbeidsmarkt gtt Belastingpolitiek gtt Minimumlonen gtt Arbeitsmarkt Mathematisches Modell Production functions (Economic theory) Unemployment Effect of fiscal policy on Mathematical models Unemployment Effect of manpower policy on Mathematical models Wages Effect of fiscal policy on Mathematical models Wages Effect of manpower policy on Mathematical models Aizenman, Joshua 1949- Verfasser (DE-588)124080057 aut National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 4769 (DE-604)BV002801238 4769 |
| spellingShingle | Agénor, Pierre-Richard 1957- Aizenman, Joshua 1949- Macroeconomic adjustment with segmented labor markets National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series Arbeidsmarkt gtt Belastingpolitiek gtt Minimumlonen gtt Arbeitsmarkt Mathematisches Modell Production functions (Economic theory) Unemployment Effect of fiscal policy on Mathematical models Unemployment Effect of manpower policy on Mathematical models Wages Effect of fiscal policy on Mathematical models Wages Effect of manpower policy on Mathematical models |
| title | Macroeconomic adjustment with segmented labor markets |
| title_auth | Macroeconomic adjustment with segmented labor markets |
| title_exact_search | Macroeconomic adjustment with segmented labor markets |
| title_full | Macroeconomic adjustment with segmented labor markets Pierre-Richard Agénor ; Joshua Aizenman |
| title_fullStr | Macroeconomic adjustment with segmented labor markets Pierre-Richard Agénor ; Joshua Aizenman |
| title_full_unstemmed | Macroeconomic adjustment with segmented labor markets Pierre-Richard Agénor ; Joshua Aizenman |
| title_short | Macroeconomic adjustment with segmented labor markets |
| title_sort | macroeconomic adjustment with segmented labor markets |
| topic | Arbeidsmarkt gtt Belastingpolitiek gtt Minimumlonen gtt Arbeitsmarkt Mathematisches Modell Production functions (Economic theory) Unemployment Effect of fiscal policy on Mathematical models Unemployment Effect of manpower policy on Mathematical models Wages Effect of fiscal policy on Mathematical models Wages Effect of manpower policy on Mathematical models |
| topic_facet | Arbeidsmarkt Belastingpolitiek Minimumlonen Arbeitsmarkt Mathematisches Modell Production functions (Economic theory) Unemployment Effect of fiscal policy on Mathematical models Unemployment Effect of manpower policy on Mathematical models Wages Effect of fiscal policy on Mathematical models Wages Effect of manpower policy on Mathematical models |
| volume_link | (DE-604)BV002801238 |
| work_keys_str_mv | AT agenorpierrerichard macroeconomicadjustmentwithsegmentedlabormarkets AT aizenmanjoshua macroeconomicadjustmentwithsegmentedlabormarkets |