Author: Martín RamaPublisher: World Bank Publications
ISBN:
Category : Commercial policy
Languages : en
Pages : 42
Book Description
Endogenous Distortions in Product and Labor Markets
Author: Martín RamaPublisher: World Bank Publications
ISBN:
Category : Commercial policy
Languages : en
Pages : 42
Book Description
Endogenous Distortions in Product and Labor Markets
Author: Martin RamaEndogenous Distortions in Product and Labor Markets
Author: Martin RamaPublisher:
ISBN:
Category :
Languages : en
Pages : 42
Book Description
Product and labor market distortions move in the same direction in response to economic and social changes. Conditionality by foreign agencies should target product market distortions. Once they are removed or diminished, labor market distortions will adjust in the desired direction.Rama and Tabellini use the common agency approach to analyze the joint determination of product and labor market distortions in a small (developing) open economy.Capital owners and union members lobby the government on tariffs and minimum wages, while factors of production in agriculture (the informal sector) are not organized. The government cares about social welfare, but also values the contributions (monetary or else) made by organized groups.Rama and Tabellini show that product and labor market distortions move in the same direction in response to changes in the relevant economic and political parameters, and that the level of those distortions is not modified by social pacts between capital and labor. They also show that conditionality by foreign agencies should target product market distortions, not labor market distortions. Labor market distortions ought not to be targeted because they are second best: they are the optimal response to the product market distortions. Labor market distortions are likely to adjust in the desired direction once product market distortions are removed or diminished.This paper - a product of the Poverty and Human Resources Division, Policy Research Department - is part of a larger effort in the department to analyze the implications of labor market distortions. The study was funded by the Bank's Research Support Budget under the research project The Impact of Labor Market Policies and Institutions on Economic Performance (RPO 678-46). Martin Rama may be contacted at [email protected].
Endogenous Distortions in Product and Labour Markets
Author: Martin RamaPublisher:
ISBN:
Category : Economics
Languages : en
Pages : 36
Book Description
The Effects of Distortions in the Factor Market
Author: Jaime De MeloPublisher:
ISBN:
Category : Capital productivity
Languages : en
Pages : 38
Book Description
Industrial Policy in the Presence of Wage Distortions
Author: Jaime De MeloPublisher:
ISBN:
Category : Automobile industry and trade
Languages : en
Pages : 44
Book Description
The Impact of Labor Market Regulations
Author: Lyn SquirePublisher: World Bank Publications
ISBN:
Category : Labor market
Languages : en
Pages : 40
Book Description
The Labor Market and Economic Adjustment
Author: Pierre-Richard AgénorPublisher: International Monetary Fund
ISBN: 1451854781
Category : Business & Economics
Languages : en
Pages : 98
Book Description
This paper examines the role of the labor market in the transmission process of adjustment policies in developing countries. It begins by reviewing the recent evidence regarding the functioning of these markets. It then studies the implications of wage inertia, nominal contracts, labor market segmentation, and impediments to labor mobility for stabilization policies. The effect of labor market reforms on economic flexibility and the channels through which labor market imperfections alter the effects of structural adjustment measures are discussed next. The last part of the paper identifies a variety of issues that may require further investigation, such as the link between changes in relative wages and the distributional effects of adjustment policies.
Should Core Labor Standards Be Imposed Through International Trade Policy?
Author: Keith Eugene MaskusPublisher: World Bank Publications
ISBN:
Category : Commercial policy
Languages : en
Pages : 92
Book Description
Endogenous Factor Market Distortion, Risk Aversion, and International Trade Under Input Uncertainty
Author: Hamid BeladiPublisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In the context of non-diversifiable and sector-specific risks in labour markets, we show that the resulting factor market distortion - attributable to an endogenous intersectoral wage differential - can provide a possible rationale that explains why larger wage dispersion prevails in developing nations. We also demonstrate how endogenous wage distortions spill over to capital markets, with capital-poor economies offering lower rates of returns. In addition, we show that inequality in the distribution of wealth further deviates factor allocation away from first-best and impairs intersectoral mobility of the poor.