Capital inflow, vanishing sector and wage distribution in an economy with corruption related intermediation

Biswajit Mandal and Sugata Marjit

Economics Bulletin, 2012, vol. 32, issue 3, 2128-2135

Abstract: This paper formulates a specific factor model of trade with skilled and unskilled workers as the specific and capital as the mobile factors. Production of goods is subject to intermediation and corruption. We then allow for international capital mobility and show that corruption as an activity may be squeezed out if the cost of intermediation is held fixed at any exogenously fixed level.

Keywords: International Trade; Intermediation; Wage-inequality; General Equilibrium. (search for similar items in EconPapers)
JEL-codes: D5 F1 (search for similar items in EconPapers)
Date: 2012-07-30
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Citations: View citations in EconPapers (8)

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