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International Migration of Labour and Skilled-Unskilled Wage Inequality

Shigemi Yabuuchi and Sarbajit Chaudhuri ()
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Shigemi Yabuuchi: Nagoya City University, Japan

International Trade from University Library of Munich, Germany

Abstract: The present note develops a three sector general equilibrium structure with diverse trade pattern and imperfection in the unskilled labour market to analyze the consequences of international mobility of skilled and unskilled labour on the skilled-unskilled wage inequality in the developing economies. The analysis finds that an emigration (immigration) of either type of labour is likely to produce a favourable (an unfavourable) effect on the wage inequality. In particular, the result of emigration (immigration) of skilled labour on the relative wage inequality is counterintuitive. These results have important policy implications for an overpopulated developing country like India.

Keywords: Skilled labour; unskilled labour; wage inequality; emigration (immigration) of labour; labour market imperfection; diverse trade pattern (search for similar items in EconPapers)
JEL-codes: F13 J31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab
Date: 2005-10-20
Note: Type of Document - pdf; pages: 10
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