FOREIGN CAPITAL INFLOW, NON-TRADED INTERMEDIARY, URBAN UNEMPLOYMENT AND WELFARE IN A SMALL OPEN ECONOMY: A THEORETICAL ANALYSIS
Sarbajit Chaudhuri ()
International Trade from EconWPA
The paper attempts to analyze the implications of foreign capital inflow in a small open economy with a non-traded intermediary on the welfare and urban unemployment in a three- sector Harris-Todaro (1970) framework. The standard immiserizing result of a foreign capital inflow has been found to be valid when the non-traded intermediary is solely used in the protected import-competing sector. However, if the export sector too uses the intermediary the economy may experience an improvement in its welfare and a reduction in the urban unemployment level.
Keywords: Non-traded intermediary; Foreign capital; Welfare; Urban unemployment; Protected import-competing sector; Export sector (search for similar items in EconPapers)
JEL-codes: F2 F20 F21 (search for similar items in EconPapers)
Note: Type of Document - pdf; pages: 11
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Journal Article: Foreign Capital Inflow, Non-traded Intermediary, Urban Unemployment, and Welfare in a Small Open Economy: A Theoretical Analysis (2001)
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpit:0511008
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