Journal of Political Economy Vol. 85 No. 3 1977
Regional Product Price Differences and the Sectoral Distribution of Labor in Less Developed Countries
Abstract
A model is presented in which open unemployment exists as a result of adverse terms of trade in rural areas, combined with a binding urban wage floor. In contrast to previous investigations involving sector-specific wage rigidity, the present analysis considers a third sector, transport, in addition to farming and manufacturing and deals with transport-infrastructure investments as policy instruments affecting employment. The three-sector model predicts that extensive unutilized land will be present despite high urban unemployment rates, a common phenomenon in sub-Saharan Africa. The model is tested empirically using primary data from the 1970 agricultural census of Zaire.
- DOI
- 10.1086/260583
- Volume
- 85
- Issue
- 3
- Pages
- 549-568
- Language
- en
- Sources
- openalex crossref