ILRIC 635 Lecture 10 - ILRIC 635 Lecture 10 Readings for...

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ILRIC 635 Lecture 10 Readings for Monday: - “Good Jobs Wanted”, “Labor Market Policies”, Friedman: “Too Sick” chapter 15 Policy Relevant Labor Market Models - Model 1: Single labor market with market-clearing (Example: Tompkins County) W S W* D 2 D 1 L* L - Model 2: Integrated L mkt model – Two labor markets with market-clearing Taiwan (manuf v. agri): W M W A W / * W* D / M D A D M O M L M L A O A - Model 3: Two labor markets with wage dualism (W. Arthur Lewis) Formal Informal W F W I S 2 W F1 S 1 D F2 W I1 D F1 D I L F L I Once wages for informal and formal market have the same wage, formal employers must raise wages in order to attract more workers (like model 2) This is called “ The Lewis Turning Point - Model 4: Two Labor markets with dualism, unemployment (Harris-Tudaro) Kenya (1970): 1964 Tripartite Agreement: freeze wages and increase employment Nairobi S 1 S 2 W unemp S W new unemp W 1 D 2 D 2 D 1 D 1 L L Model Assumptions: urban = manufacturing; rural = agriculture o Migration on the basis of expected wages [E(W) = W L
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This note was uploaded on 04/14/2008 for the course ILRIC 4350 taught by Professor Fieldsg during the Spring '08 term at Cornell University (Engineering School).

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ILRIC 635 Lecture 10 - ILRIC 635 Lecture 10 Readings for...

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