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Rising wage inequality in developing economies: Privatization and competition

Year: 2006

Type: article

Abstract: Using a dual structure depicting a developing economy, this paper shows that increased partial privatization or foreign competition can lead to wage inequality between skilled and unskilled labor. In addition, rising wage inequality can be triggered by inflows of unskilled labor or outflows of skilled labor and/or capital. Further, partial privatization or foreign competition reduces the urban output, thereby raising the goods price and unemployment ratio. These effects lower social welfare of the economy.

Source: Journal of International Trade & Economic Development

DOI: 10.1080/09638190600871719

Authors: Chi-Chur Chao, Bharat R. Hazari, Eden S. H. Yu

Institutions: Oregon State University, Chinese University of Hong Kong, City University of Hong Kong

Language: English

Topic: Global trade and economics

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Decent work and economic growth, Reduced inequalities, No poverty

Open Access status: green

OpenAlex ID: W1995702894

FWCI: 0.668

Cites: 19

Cited by: 15

Related to: 10