Citation

Discussion Paper Details

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Title: Dualism and Aggregate Productivity

Author(s): Jonathan Temple

Publication Date: May 2004

Keyword(s): dualism, minimum wages, productivity and wage differentials

Programme Area(s): International Macroeconomics

Abstract: This Paper shows how to calibrate a two-sector general equilibrium model of production using a small number of parameter assumptions and readily available data. The framework is then used to analyse the costs of labour market dualism. The Paper quantifies the effects of rural-urban wage differentials and urban unemployment on aggregate productivity, wages and returns to capital, factor shares, and sectoral structure. One of the main findings is that labour market rigidities can have a major impact on the extent of industrialization.

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Bibliographic Reference

Temple, J. 2004. 'Dualism and Aggregate Productivity'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=4387