Chapter 7.2 notes

The imbalance between economic opportunities in the

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Unformatted text preview: urban wage depends on the actual wage, the number of urban jobs, and the number of urban job seekers o High rates of urban unemployment are inevitable given the imbalance between economic opportunities in the rural sector and the urban sector - Limitations of Harris- Todaro o Explain migration only of those with sufficient human capital to compete for modern sector jobs o In practice not at equilibrium: often, even traditional (informal) urban wage higher than rural traditional wage, implying massive migration still to come o Sometimes urban wage is high even without intervention o So harris- todaro is the place the start but need to expand concepts of migration to include those who intentionally migrate to work in the traditional urban sector - Generalizing Harris- Todaro o Info...
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