International Trade, Migration and Unemployment – The Role of Informal Sector

Sugata Marjit and Biswajit Mandal

MPRA Paper from University Library of Munich, Germany

Abstract: This paper provides an elaborate general equilibrium framework by including informal economic activities in a model of trade, migration and unemployment. Existence of informal activities is critical in generating positive employment effects of liberal trade policies. Following a tariff cut informal wage increases and rate of unemployment goes down under reasonable conditions. Next we generalize the benchmark model to capture the phenomenon of sequential migration: from agriculture to urban informal sector, and then to urban formal sector. The paper also extends the benchmark model to include both informal intermediate and final good.

Keywords: International Trade; Employment; Informal Wage; General Equilibrium. (search for similar items in EconPapers)
JEL-codes: D5 F1 J31 O17 (search for similar items in EconPapers)
Date: 2015-02
New Economics Papers: this item is included in nep-int and nep-iue
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Related works:
Journal Article: International Trade, Migration and Unemployment – The Role of Informal Sector (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:68225

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