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International Factor Mobility, Wage Inequality and Welfare: A Theoretical Analysis
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- Title
- International Factor Mobility, Wage Inequality and Welfare: A Theoretical Analysis
- Author/Creator
-
Anwar, S
- Description
- This paper shows that inflow of skilled (unskilled) labour increases wage inequality and its effect on foreign investment in the industrial sector and welfare in the shortrun is positive (negative) as long as the positive (negative) impact on the output of varieties of producer services is sufficiently large. An increase in the supply of domestic capital decreases wage inequality and its effect on foreign investment and welfare in the shortrun is positive as long as the positive impact on the output of varieties of producer services is sufficiently large. The magnitude of the longrun effect on foreign investment, wage inequality and welfare depends on the size of external economies in the industrial sector. Inflow of skilled labour leads to an unambiguous increase in foreign investment, wage inequality and welfare; whereas inflow of unskilled labour can decrease foreign investment and its effect on wage inequality and welfare can be negative. Finally, an increase in the supply of domestic capital increases foreign investment and its effect on wage inequality and welfare can be positive.
- Relation
- 36th Australian Conference of Economists, Hobart, Australia 24-26 September 2007
- Relation
- Conference Proceedings: 36th Australian Conference of Economists / pp.1-20
- Relation
- http://www.ecosoc.org.au/files/File/TAS/ACE07/presentations (pdf)/Anwar.pdf
- Year
- 2007
- Publisher
- Economic Society of Australia Inc.
- Subject
-
FoR 1402 (Applied Economics) |
wage inequality |
foreign investment |
labour inflow |
welfare
- Resource Type
- Conference Paper
- Identifier
- ISBN: 9780959337013
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