Wage and Fertility Gaps in Dual Economies

Sibabrata Das (), Alex Mourmouras () and Peter Rangazas
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Sibabrata Das: International Monetary Fund
Alex Mourmouras: International Monetary Fund

Chapter Chapter 5 in Economic Growth and Development, 2015, pp 123-160 from Springer

Abstract: Abstract This chapter begins our analysis of two-sector modelsStability two-sector model where markets may be missing. Here, we focus on the fact that wages are lower and fertility is higher in the traditional sectorTraditional sector than in the modern sector of economies. This has important consequences for economic growth for two reasons. First, the wage gap suggests that the allocation of labor may be inefficient—the movement of labor from the traditional sector to the modern sector should raise average labor productivity. Second, if fertility falls as householdsPreferences households move from the traditional sector to the modern sector, then population growthPopulation growth will decline making it easier to increase physical capital per worker.

Keywords: Human Capital; Marginal Product; Family Production; Child Labor; Family Farm (search for similar items in EconPapers)
Date: 2015
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Chapter: Wage and Fertility Gaps in Dual Economies (2018)
Journal Article: Wage and Fertility Gaps in Dual Economies (2013)
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DOI: 10.1007/978-3-319-14265-4_5

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