intra metropolitan variation in earnings and labor market discrimination an econometric analysis of the atlanta labor market one of the most enduring debates concerning racial differences in earnings is whether housing segregation within metropolitan areas adversely affects the employment opportunities of urban blacks two possible negative effects can be listed first the decentralization of lower skilled jobs combined with the suburban residential exclusion of low income households may have caused wage rates within the suburban labor market to rise above those paid within the central city if this is the case and if housing market discrimination restricts the relative ability of blacks to offer their labor supply to suburban employers then at least part of the racial difference in earnings can be attributed to housing segregation second housing segregation may cause private sector labor market discrimination to be more severe within the central city in comparison to suburban areas as suggested by becker s taste for discriminating model 3 a relatively large black labor supply within the central city may require a lower black to white earnings ratio in order to induce prejudiced employers to hire large numbers of black workers with the workforce of most central cities becoming increasingly black this may be an important factor in explaining racial differences in earnings surprisingly while variation in discrimination among occupations regions industries and sectors have been examined in some detail spatial differences in discrimination between the central city and suburbs have largely escaped analysis in this paper the earnings of private sector workers broken down by occupation race and sex are compared between worksite areas encompassing the metropolitan area of atlanta georgia while an extensive literature can be found on interregional differences in earnings little evidence exists on the spatial variation in wage rates within metropolitan regions in fact virtually nothing has been done on this issue since the classic study of the chicago labor market by rees and shultz 19

introduction imperfect information and rural credit markets puzzles and policy perspectives rural credit markets have been at the center of policy intervention in developing countries over the past forty years many governments supported by multilateral and bilateral aid agencies have devoted considerable resources to supplying cheap credit to farmers in a myriad of institutional settings the results of many of these interventions have been disappointing and one explanation for this must be that they were based on an inadequate understanding of the workings of rural credit markets the articles in this symposium issue are devoted to empirical and theoretical investigations of rural credit markets in the framework of the imperfect information paradigm the authors show how this framework is useful not only in explaining puzzling features of these markets but also in providing a policy perspective to assess the successes and failures of specific interventions

labor migration and risk aversion in less developed countries in this paper we question the pioneering work of todaro which states that rural to urban labor migration in less developed countries ldcs is an individual response to a higher urban expected income we demonstrate that rural to urban labor migration is perfectly rational even if urban expected income is lower than rural income we achieve this under a set of fairly stringent conditions an individual decision making entity a one period planning horizon and global risk aversion we obtain the result that a small chance of reaping a high reward is sufficient to trigger rural to urban labor migration

e ztax tax salience and tax rates this paper examines whether the salience of a tax system affects equilibrium tax rates i analyze how tolls change after toll facilities adopt electronic toll collection etc drivers are substantially less aware of tolls paid electronically i estimate that in steady state tolls are 20 to 40 percent higher than they would have been without etc consistent with a salience based explanation for this toll increase i find that under etc driving becomes less elastic with respect to the toll and toll setting becomes less sensitive to the electoral calendar alternative explanations appear unlikely to be able to explain the findings

welfare transfers in two parent families labor supply and welfare participation under afdc up this paper examines the effect of cash transfers and food stamp benefits on family labor supply and welfare participation among two parent families the aid to families with dependent children unemployed parent program has provided cash benefits to two parent households since 1961 despite recent expansions little is known about the program s effect on labor supply and welfare participation i develop a model of family labor supply in which hours of work for the husband and wife are chosen to maximize family utility subject to a family budget constraint accounting for afdc up benefits and other tax and transfer programs the husband s and wife s labor supply decisions are restricted to no work part time work and full time work maximum likelihood techniques are used to estimate parameters of the underlying hours of work and welfare participation equations the estimates are used to determine the magnitude of the work disincentive effects of the afdc up program and to simulate the effects of changes in afdc up benefit and eligibility rules on family labor supply and welfare participation the results suggest that labor supply and welfare participation among two parent families are highly responsive to changes in the benefit structure under the afdc up program

human capital minimum wage and unemployment a harris todaro model of a developed open economy in many developed countries unemployment is a serious and persistent problem although the character of this problem is highly complex one of its features which can easily be observed is the substantially higher incidence of unemployment among unskilled workers than among those who are skilled a possible explanation for this is the existence of an institutionally given minimum wage which exceeds the market clearing wage for unskilled labour but lies below the equilibrium wage for skilled labour moreover for those who find themselves unemployed because of the minimum wage the principal source of job opportunities tends to be the services sector of the economy which is relatively intensive in its use of unskilled labour the objective of this paper is to develop a simple model of a small open economy based on these observations and to examine the policy implications that emerge from it in connection with the unemployment problem the focus of the analysis however is not on the cyclical aspects of this problem but rather on its steady state nature the basic structure of the model is as follows our economy has two sectors engaged in the production of consumption goods one of these goods is assumed to be traded internationally and the other is non traded following rodriguez 1975 i draw a further distinction between the two sectors nontraded goods which may be regarded as services are assumed to require the use of only capital and unskilled labour as inputs while the traded goods sector uses only capital and skilled labour skills are viewed as productive human capital which can be acquired through formal training in order to sharpen the focus of our analysis on the process of human capital formation i will ignore the problems of physical capital accumulation and population growth the economy is assumed to be small facing a given world price of traded goods as well as a given rental at which the supply of capital from abroad is infinitely elastic in contrast with the assumption of perfect capital mobility neither type of labour is mobile internationally with only one traded commodity and one mobile factor international trade for this economy amounts to an exchange of the single traded consumption good for the services of capital at fixed terms of trade section i of the paper presents the model and solves for the stationary composition of the labour force i e skilled v unskilled and the equilibrium values of relative factor and commodity prices section ii introdluces an institutionally given minimum wage which is binding only in the market for unskilled labour in the spirit of harris and todaro 1970 it is assumed that

studying optimal paternalism illustrated by a model of sin taxes the classical economic approach to policy analysis assumes that people always respond optimally to the costs and benefits of their available choices a great deal of evidence suggests however that in some contexts people make errors that lead them not to behave in their own best interests economic policy prescriptions might change once we recognize that humans are humanly rational rather than superhumanly rational and in particular it may be fruitful for economists to study the possible advantages of paternalistic policies that help people make better choices we propose an approach for studying optimal paternalism that follows naturally from standard assumptions and methods of economic theory write down assumptions about the distribution of rational and irrational types of agents about the available policy instruments and about the government s information about agents and then investigate which policies achieve the most efficient outcomes in other words economists ought to treat the analysis of optimal paternalism as a mechanism design problem when some agents might be boundedly rational this approach has many advantages first and foremost by explicitly addressing when and how people do and don t pursue their own best interests economists will be better able to contribute to policy debates to contribute to debates over regulating private financial decisions we must study whether financial decisions are based on fallacious statistical reasoning and whether self control problems lead people to borrow too heavily to contribute to debates over teenage smoking we must study whether teenagers become smokers against their long run best interest economists will and should be ignored if we continue to insist that it is axiomatic that constantly trading stocks or accumulating consumer debt or becoming a heroin addict must be optimal for the people doing these things merely because they have chosen to do it a second advantage of our approach is that it forces us to look for the best feasible policy our

trade education and growth the small country case this paper develops optimal educational and trade policies for a small open economy capable of growth a theoretical structure previously used for the analysis of education and growth in closed economies manning 1975 1976 1978 1979a 1979b 1981b is extended to do this the analysis is aggregative it differs from that of a similar problem by aarrestad 1978 by allowing for heterogeneity of the labor force recently henry 1979 and henry and manning 1980 developed the model of this paper to permit the endogenous determination of international commodity prices but only in the context of balanced growth all of these papers belong to a small literature on aggregative aspects of education and growth other examples of which include aarrestad 1975 hu 1976 razin 1972a 1972b tu 1969 1970 and uzawa 1965 oniki and uzawa 1965 is the classic extension of the heckscher ohlin theory of international trade to permit growth in models of their type production possibilities are given instantaneously and are altered over time by factor accumulation educational policy affects the production possibility set in two ways an increase in educational activity reduces the factors available to produce traded goods and so shrinks the production possibility set immediately in the longer term the level of skill is altered so changing the production possibility set both the size and shape of the production possibility set are determined statically and dynamically by educational policy mcmillan 1978 has recently presented a model of public intermediate goods trade and growth with the same property a problem like this is considered in manning 1981a for a general model of capital accumulation and growth the structure of this paper is as follows the model and optimality conditions are first presented growth is then analyzed and it is found that specialization is the most likely pattern of production a deeper investigation of the economics of the model explains this conclusion some concluding remarks are then made details of the lengthy mathematical proofs of two propositions are relegated to a mathematical appendix

the optimal elasticity of taxable income abstract the strength of the behavioral response to a tax rate change depends on the environment individuals operate in and may be manipulated by instruments controlled by the government we first derive a measure of the social benefit to affecting this elasticity the paper then examines this effect in the solution to the optimal income taxation problem when such an instrument is available first in a general model and then in an example when the government chooses the income tax base

what has been learned about labor supply in the past twenty years the main advance in the study of labor supply in the past 20 years has come in recognizing and interpreting the variety of different labor supply functions that coexist in the empirical literature a crucial theoretical distinction with important empirical payoff is that between labor supply choices at the extensive margin i e labor force participation and employment choices and choices at the intensive margin i e choices about hours of work or weeks of work for workers another important distinction is the one between a descriptive labor supply function and a structural supply function that can be the basis for out of sample policy investigations concerning responses to tax and welfare programs and evaluations of welfare losses a full understanding of the participation hours dichotomy leads to an appreciation of the importance of the problem of selection bias what is the wage to impute to a nonworking person these distinctions are a legacy of the research conducted on labor supply over the past 20 years many important empirical questions have been addressed i how strong are the effects of taxes welfare and transfer programs on labor supply ii how important is intertemporal substitution can life cycle labor supply models explain business cycle labor supply behavior iii has the consensus view of the 1960 s of high labor supply elasticities for married women and low labor supply elasticities for married men held up all of the empirical evidence assembled on labor supply must be called into question in the light of important research on the basic quality of the data conducted by analysts at the university of michigan i discuss this evidence in a concluding section except for my discussion of measurement issues i focus only on the major discoveries about which a general consensus has emerged

interjurisdictional sorting and majority rule an empirical analysis the goal of this paper is to provide a comprehensive empirical analysis of majority rule and tiebout sorting within a system of local jurisdictions the idea behind the estimation procedure is to investigate whether observed levels of public expenditures satisfy necessary conditions implied by majority rule in a general equilibrium model of residential choice the estimator controls for observed and unobserved heterogeneity among households observed and unobserved characteristics of communities and the potential endogeneity of prices and expenditures as well as the self selection of households into communities of their choice we estimate the structural parameters of the model using data from the boston metropolitan area the empirical findings reject myopic voting models more sophisticated voting models based on utility taking provide a potential explanation of the main empirical regularities

regional welfare programs and labor force participation welfare program dependency and expenditures rise during recessions while income tax revenues from working people fall thus now that states are responsible for their own welfare programs they need to know how responsive their citizens are to workplace and safety net opportunities this paper investigates household welfare program and labor force participation behavior a choice theoretic model is developed and estimated for each of the four census regions northeast midwest south and west using cross sectional data on households labor markets and policies we show that household responses to welfare program parameters do differ regionally but we find that labor supply does not depend on welfare program participation or program payoffs furthermore unlike under the previous welfare program participation in temporary assistance for needy families tanf does not significantly reduce household labor supply the finding of significant differences across regions justifies the efficiency rationale for the devolution of authority to the states we also discuss how states may be able to contain expenditures on welfare programs

a structural model of multiple welfare program participation and labor supply work on estimating the labor supply effects of high marginal tax rates in welfare programs has been hindered by the difficulty of estimating the effects of participation in multiple welfare programs simultaneously the authors solve this problem by applying methods of simulation estimation to a model of labor supply and multiple program participation the results show asymmetric wage and tax rate effects with fairly large wage elasticities of labor supply but very inelastic responses to moderate changes in cumulative marginal tax rates implying that high welfare tax rates do not necessarily induce major reductions in work effort copyright 1998 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

an economic model of welfare stigma perhaps the most basic assumption of the economic theory of consumer demand is that more is better than less virtually all of the major propositions of consumer theory can in a certain sense be derived from the assumption that goods are good interestingly however this tenet seems to be violated by the behavior of many individuals in the low income population for many turn out to be eligible for a positive welfare benefit but do not in fact join the welfare rolls for example it has been estimated that in 1970 only about 69 percent of the families eligible for afdc aid to families with dependent children participated in the program see richard michel 1980 the corresponding percentage for afdc u the program for which families with an unemployed male are eligible was only 43 percent and the participation rate in the food stamp program was only 38 percent see maurice mcdonald 1977 this phenomenon has puzzled many investigators because such individuals do not locate on the boundaries of their budget sets consequently most investigators ignore the problem when studying the effects of welfare programs on behavior in this paper this seemingly irrational rejection of an increase in income is modeled as resulting from welfare stigma that is from disutility arising from participation in a welfare program per se 1 the existence of stigma has been amply documented in the sociological literature patrick horan and patricia austin 1974 lee rainwater 1979 where interviews of recipients have often uncovered feelings of lack of self respect and negative self characterizations from participation in welfare nevertheless this phenomenon has not been modeled and many questions consequently remain when is the disutility of participation strong enough to prevent participation shouldn t we expect individuals to weigh the disutility of participation against the potential benefit in their decisions what is the elasticity of participation with respect to the potential benefit also in a slightly different vein how are the work disincentives of welfare affected by stigma these questions have been given scant attention by economists yet they are crucial for our ability to predict the impact of various welfare programs on the lowincome population here these questions are addressed by modeling nonparticipation as a utility maximizing decision the model is developed and estimated for the afdc program 2 the model posits an individual utility function containing not just disposable income but

estimating the costs of partial coverage rent controls a stochastic frontier approach this paper presents a modified frontier approach to estimate hedonic regressions for data on rent controlled and uncontrolled apartments this new approach allows the author to estimate the size of the subsidy from landlords to tenants of rent controlled apartments in addition this method provides the first estimates of the amount by which controls increase rents for uncontrolled apartments the study shows that in new york city in 1968 rents in the controlled sector would rise 22 to 26 percent upon decontrol while rents in the uncontrolled sector would fall about 22 to 25 percent upon removal of rent controls copyright 1993 by mit press

optimal tax salience abstract recent empirical work finds that consumers under account for commodity taxes when the after tax price is not prominent i investigate how policymakers may utilize such low salience taxes to promote welfare the optimal combination of high and low salience taxes balances two competing effects low salience taxes dampen distortionary substitution but cause consumers to misallocate their budgets using a stylized model i show the availability of taxes with differing salience provides an extra degree of freedom that can be used to implement the first best welfare outcome i characterize the optimal policy and derive a formula for incremental adjustments when the first best is unattainable

optimal taxation with behavioral agents this paper develops a theory of optimal taxation with behavioral agents we use a general framework that encompasses a wide range of biases such as misperceptions and internalities we revisit the three pillars of optimal taxation ramsey linear commodity taxation to raise revenues and redistribute pigou linear commodity taxation to correct externalities and mirrlees nonlinear income taxation we show how the canonical optimal tax formulas are modified and lead to novel economic insights we also show how to incorporate nudges in the optimal taxation framework and jointly characterize optimal taxes and nudges

behavioral effects of withholding taxes on labor supply in most advanced economies income tax collection uses third party withholding for wage income because withholding taxes do not necessarily reflect true effective taxes these may give false signals of net of tax pay we test labor supply responses to such misconceptions using laboratory experiments withholding taxes and the resulting tax refunds should be behaviorally neutral but our results show that tax adjustments lead to effort adjustments which suggests that withholding blurs tax incentives while there is no statistically significant response in the overall sample the participants in the subgroup who self assess to be motivated by monetary incentives about half of the total sample reduce their effort in response to withholding taxes and increase their effort after receiving tax refunds

underpaid and overworked measuring the effect of imperfect information on wages this paper investigates the degree of shortfall between the wages workers earn and what they could earn assuming perfect or costless information in the labor market we use the stochastic frontier regression technique to estimate the degree of shortfall found in wages on an individual basis the paper tests in addition a number of hypotheses supplied by search theory in this context the results generally confirm the propositions from search theory and indicate that on the average worker wages fall short of worker potential wages by approximately 10 percent

taxpayer confusion evidence from the child tax credit we develop an empirical test for whether households understand or misperceive their marginal tax rate our identifying variation comes from the loss of the child tax credit when a child turns 17 using this age discontinuity we find that despite this tax liability increase being lump sum and predictable households reduce their reported wage income upon discovering they have lost the credit this finding suggests that households misinterpret at least part of this tax liability change as an increase in their marginal tax rate this evidence supports the hypothesis that tax complexity can cause confusion and leads to unintended behavioral responses jel d12 d14 h24 h31

beyond revealed preference choice theoretic foundations for behavioral welfare economics we propose a broad generalization of standard choice theoretic welfare economics that encompasses a wide variety of nonstandard behavioral models our approach exploits the coherent aspects of choice that those positive models typically attempt to capture it replaces the standard revealed preference relation with an unambiguous choice relation roughly x is strictly unambiguously chosen over y written xp y iff y is never chosen when x is available under weak assumptions p is acyclic and therefore suitable for welfare analysis it is also the most discerning welfare criterion that never overrules choice the resulting framework generates natural counterparts for the standard tools of applied welfare economics and is easily applied in the context of specific behavioral theories with novel implications though not universally discerning it lends itself to principled refinements

attention variation and welfare theory and evidence from a tax salience experiment this article shows that accounting for variation in mistakes can be crucial for welfare analysis focusing on consumer under reaction to not fully salient sales taxes we show theoretically that the efficiency costs of taxation are amplified by differences in under reaction across individuals and across tax rates to empirically assess the importance of these issues we implement an online shopping experiment in which 2 998 consumers purchase common household products facing tax rates that vary in size and salience we replicate prior findings that on average consumers under react to non salient sales taxes consumers in our study react to existing sales taxes as if they were only 25 of their size however we find significant individual differences in this under reaction and accounting for this heterogeneity increases the efficiency cost of taxation estimates by at least 200 tripling existing sales tax rates nearly doubles consumers attention to taxes and accounting for this endogeneity increases efficiency cost estimates by 336 our results provide new insights into the mechanisms and determinants of boundedly rational processing of not fully salient incentives and our general approach provides a framework for robust behavioural welfare analysis

rural urban welfare program and labor force participation nonmetro poor in the midwest participate more in the labor force and less in welfare programs than metro poor we formalize how household composition capital labor market conditions and state specific regulations define opportunity sets then estimate a bivariate binomial probit model of work and program participation choices an oaxaca decomposition analysis is conducted to compare differences in characteristics to differences in behavior in explaining the two groups choices we find no behavioral basis for the difference in labor market participation and while most of the lower midwestern nonmetro welfare program participation is due to demographics some is due to different life cycle behavior

does regulation improve small farmers access to brazilian rural credit abstract brazilian policymakers attempted to counter the inherent tendency for concentration in subsidized rural credit programs by requiring banks to lend a specified volume to small farmers inferences about the regulation s success are drawn from farm level panel data from sao paulo in the early 1980s membership in the target group should have a positive effect in an access rule relating farmers characteristics to their probability of receiving credit when allowing for time invariant individual effects possibly correlated with target group indicators tests indicate that the regulation had no effect subsidiary results cast doubt on the efficacy of a broader set of regulations

two way capital flows cross hauling in a model of foreign investment this paper presents a simple model of a small open economy which is open to both commodity trade and foreign investment of a sector specific kind and which exhibits the phenomenon of cross hauling or reverse flows of internationally mobile capital in two different sectors the model which assumes that a single domestic factor is combined with internationally mobile but sector specific capital in each of two sectors one of which produces a non traded good appears to be the simplest possible which permits cross hauling as an endogenous phenomenon

labor force migration and allocative efficiency in the united states the roles of information and psychic costs this paper examines the relative importance of information psychic and other costs of relocation as mitigating factors off sets to spatial earnings differentials within the migration decision the method employed for this examination is based upon 1 observation of relationships between the geographic allocation and personal characteristics of labor force migrants and 2 inferences drawn from these observations about the relative importance of various relocation cost components empirical analyses of the migration decision based upon this indirect method provide important insights on both the determinants and allocative efficiency of interstate labor force migration in the united states excerpt

post migration earnings profiles an application of human capital and job search models several studies have noted that post migration earnings of migrants rise more rapidly than earnings of non migrants 13 42 9 human capital models would attempt to explain this by differences in the investment profiles of migrants and non migrants these differences could be due to migration selectivity whereby migrants have different investment incentives due to ability or motivation or to the loss of human capital by migrating and the recoupment of this capital after migration search models would explain this phenomenon by imperfect information migrants may have less information about wage distributions at the destination than non migrants enter the destination job market at a low wage and engage in subsequent post migration search for better earnings or as yezer and thurston 15 have suggested search may be selective and migrants whose reservation wages are not met after some time at the destination leave i e we observe migrants having steeper earnings profiles since those who do not obtain high earnings leave as one might expect neither of these pure models is alone sufficient to explain the factors that create the different earnings streams instead they can be viewed as complementary explanations the failure to recognize that migration involves both job search and human capital changes could lead to biased tests of hypotheses originating from only one model a good example of this and the one addressed in this paper is testing hypotheses regarding the source of differences between experience earnings profiles of migrants and non migrants for example yezer and thurston 15 establish and test the hypothesis that the distance migrated should be positively associated with income gains after migration they find the expected relation using regressions with a distance dummy 2 however it is well known that more educated individuals travel greater distances 11 and generally have steeper earnings profiles than less educated persons the correlation between education and distance migrated makes any test of the yezer and thurston hypothesis biased toward accepting their search model when education is not controlled

efficiency wage models of unemployment keynesian economists hold it to be self evident that business cycles are characterized by involuntary unemployment but construction of a model of the cycle with involuntary unemployment faces the obvious difficulty of explaining why the labor market does not clear involuntarily unemployed people by definition want to work at less than the going wage rate why don t firms cut wages thereby increasing profits

capital market imperfections labor market disequilibrium and migration a theoretical and empirical analysis i introduction in a thoughtful and pioneering work katz and stark 1986 suggest that capital market imperfections may be an important cause of migration in less developed countries their model is important because it provides an alternative to the host of migration models which focus exclusively on labor market conditions 1 consider for the moment an agricultural region of a less developed country that is undergoing rapid technological change to avail themselves of this change in agricultural technology individuals must possess some minimum amount of financial capital to invest if capital markets were perfect any individual could obtain financing provided that the potential project had an internal rate of return greater than the interest rate if on the other hand some minimum asset value is required to enter capital markets individuals whose asset value is below this level may migrate out of the region for reasons which are more fully discussed below 2 thus katz and stark predict strong migration outflows from regions with a high marginal product of capital and a significant absence of or imperfection in capital markets in a general equilibrium framework of course disequilibrium in one market must be reflected by disequilibrium in some other market so the labor market may be in disequilibrium as well but the fundamental cause may be capital market imperfections capital market imperfections may keep wages low by limiting the amount of capital per worker and hence the marginal product of labor which is then mistakenly interpreted in a migration model as corroboration of the todaro hypothesis in a sense perhaps the todaro model is correct low origin wages in comparison to the expected wage in the destination are driving outmigration but in a more fundamental sense capital market imperfections are causing the outmigration katz and stark derive an interesting and important conclusion from their model viz if a main cause of rural to urban migration a labor market phenomenon is capital market imperfections then a policy to constrain migration should aim at enhancing access to and improving the competitiveness of capital markets and shift away from exclusive attempts to reduce rural urban wage differentials p 137 but to get to the policy conclusion one must first deal with the thorny issue of observational equivalence are low origin wages due to labor or capital market conditions this essay is an attempt to empirically disentangle the two using empirical evidence from ecuador i will proceed as follows first i briefly describe imperfections in ecuadorian capital markets which might lead to out migration from rural areas and summarize recent changes in ecuadorian agriculture which may have intensified the impact of capital market imperfections on migration the combination of these factors may provide the conditions necessary for the katz stark hypothesis i e that imperfect capital markets limit individuals ability to take advantage of changed agriculture structure and technology and that outmigration results the next section formally presents the competing hypotheses labor market vs capital market explanations for internal migration and derives estimating equations the final section attempts to distinguish between the two hypotheses and outlines some important policy conclusions ii capital market structure and technological change in ecuadorian agriculture adios smallholders agricultural credit policy in ecuador was heavily influenced by the easy money of the 1970s and early 1980s as an oil exporter ecuador benefited enormously from the two oil shocks the central bank was flush with new found foreign exchange from oil revenues and external borrowing and much of this windfall was recycled into the domestic economy in the form of sectoral credit at negative real interest rates 3 the agricultural sector was a prime beneficiary of this largesse

on the harris todaro model with intersectoral capital mobility n b professor neary was based at trinity college dublin when this article was first published the full text of the article is not available in ora at this time citation neary j p 1981 on the harris todaro model with intersectoral capital mobility economica 48 191 219 234

policy comparisons with an agglomeration effects augmented dual economy model abstract in this paper we incorporate urban agglomeration economies as a labor pull factor in an analysis of dual labor markets in ldcs in particular the equilibrium city size approach to urban growth and the expected income approach to rural to urban migration are synthesized making it possible to generalize results that hitherto were approach specific with the aid of a simulation based on a well specified model we exploit this synthesis to rank subsidy policies our results highlight the constructive role played by urbanization in economic development and structural change

life on the frontier migrant information earnings and past mobility this paper examines the extent to which information obtained from past geographic mobility affects both post move job search and earnings in subsequent migration in the united states the study considers this linkage between past and present mobility by estimating earnings frontiers for various categories of interstate migrants partitioned by prior mobility history the results demonstrate that migrant groups exhibiting high relative levels of human capital stock do not necessarily possess superior pre move labor market information it is also demonstrated that the incentive to acquire this pre move information is tied to psychic cost and variation in this cost among migrant types excerpt

on the harris todaro model with intersectoral migration of labour aspects of labor migration in developing countries are examined using the approach developed by j r harris and m p todaro in particular the author attempts to model the process of labor turnover between the urban unemployed and urban firms and between the rural sector and the urban unemployed the model includes a dynamic system of wage rates and urban unemployment rates annotation

observational equivalence in the modeling of african labor markets and urbanization abstract this article examines the appropriateness of neoclassical and rent seeking models of urbanization for the african milieu and demonstrates that the reduced forms of these two models may be quite similar the models are not observationally equivalent however and methods of distinguishing between them are discussed a demographic cohort shift model of african urbanization also is presented its excellent predictive power suggests that migration models that assume migrant homogeneity i e highly aggregate migration models ignore information that can be useful in predicting trends in migration flows

inattention to deferred increases in tax bases how michigan home buyers are paying for assessment limits abstract michigan s implementation of assessment limits gives rise to a wide variation in taxable basis across comparable homes exploiting the fact that the resulting differences in property tax liability are temporarily inherited by new homebuyers i estimate the degree of capitalization of these largely idiosyncratic tax differences to evaluate whether homebuyers understand the tax implications of their home purchases consistent with anecdotal evidence but in stark contrast to the traditional view of rational consumer behavior i find that homebuyers are woefully inattentive to the temporary nature of their initial tax obligations resulting in an overpayment of nearly 10 000 for the average home