Public inputs, urban development, and welfare in a developing economy

Jean-Pierre Laffargue, Chi-Chur Chao and Eden Yu

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: This paper examines the impact of urban development through the government provision of public inputs in a developing economy. When a financing constraint is taken into account, an increase in public inputs may worsen urban unemployment and hence reduce welfare of the economy. Further, the optimal level of public input provision is larger (smaller) than that under full employment, if there exits a positive (negative) employment effect. The theoretical results are confirmed by numerical simulations.

Keywords: Public inputs; Urban unemployment; Welfare (search for similar items in EconPapers)
Date: 2008
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Published in Sugata Marjit & Eden Yu. Contemporary and Emerging Issues in Trade Theory and Policy, Emerald, pp.297-314, 2008, Frontiers of Economics and Globalization

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Related works:
Working Paper: Public inputs, urban development, and welfare in a developing economy (2008)
Working Paper: Public inputs, urban development, and welfare in a developing economy (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:cesptp:halshs-00645330

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