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Can International Factor Mobility lessen Wage Inequality in a Dual Economy?

Beladi, Hamid and Chaudhuri, Sarbajit and Yabuuchi, Shigemi (2007): Can International Factor Mobility lessen Wage Inequality in a Dual Economy?

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Abstract

We introduce international labor mobility in a three-sector general equilibrium model with rural-urban migration. We demonstrate that under some reasonable conditions an inflow of foreign skilled labor (capital) can reduce skilled-unskilled wage inequality.

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