Differential education subsidy policy and wage inequality between skilled, semi-skilled and unskilled labour: A general equilibrium approach
By: Mukhopadhyay, Ujjaini
.
Material type: 
BookPublisher: Review of Development and Change Description: 26(1), Jun, 2021: p.40-62.Subject(s): Skilled labour, Semi-skilled labour, Unskilled labour, Higher-education subsidy, Secondary and vocationa
In:
Review of Development and ChangeSummary: The article investigates the effects of secondary (including vocational) and higher-education subsidies on wage inequalities between skilled, semi-skilled and unskilled workers, and unemployment in a small open developing economy in terms of a two-sector Harris–Todaro dynamic general equilibrium framework. The results show that skilled–unskilled and skilled–semi-skilled wage inequalities depend on factor intensity conditions, while semi-skilled–unskilled wage inequality is determined by the level of skill formation in the economy. There is a trade-off between the wage inequalities of skilled–semi-skilled and semi-skilled–unskilled workers due to secondary education subsidy; the trade-off also exists with respect to higher-education subsidy if the manufacturing sector is more skilled labour intensive. However, if the manufacturing sector is capital intensive, higher-education subsidy is detrimental for both types of wage inequalities in the initial years of skill formation but might have favourable effects when the skill endowment is high. Both types of subsidies reduce unemployment in the initial periods, but higher-education subsidy accentuates it when skilled labour supply expands in the economy. – Reproduced
| Item type | Current location | Call number | Vol info | Status | Date due | Barcode |
|---|---|---|---|---|---|---|
Articles
|
Indian Institute of Public Administration | 26(1), Jun, 2021: p.40-62 | Available | AR125685 |
The article investigates the effects of secondary (including vocational) and higher-education subsidies on wage inequalities between skilled, semi-skilled and unskilled workers, and unemployment in a small open developing economy in terms of a two-sector Harris–Todaro dynamic general equilibrium framework. The results show that skilled–unskilled and skilled–semi-skilled wage inequalities depend on factor intensity conditions, while semi-skilled–unskilled wage inequality is determined by the level of skill formation in the economy. There is a trade-off between the wage inequalities of skilled–semi-skilled and semi-skilled–unskilled workers due to secondary education subsidy; the trade-off also exists with respect to higher-education subsidy if the manufacturing sector is more skilled labour intensive. However, if the manufacturing sector is capital intensive, higher-education subsidy is detrimental for both types of wage inequalities in the initial years of skill formation but might have favourable effects when the skill endowment is high. Both types of subsidies reduce unemployment in the initial periods, but higher-education subsidy accentuates it when skilled labour supply expands in the economy. – Reproduced
There are no comments for this item.