Suchergebnisse

F. Stewart & J. Weeks have argued that a rise in the wage rate in the "controlled" sector of an underdeveloped country might increase total employment ("The Employment Effects of Wage Changes in Poor Countries," Journal of Development Studies, 1975, 11, 2, Jan). In a reexamination of this argument, assumptions about the substitutability of capital & labor are assessed, & other factors are shown to be involved in determining the effect of a wage rise on employment, ie: the gap between the controlled & uncontrolled sectors, the labor in the controlled sector output, & the allocation of capital stock in the controlled sector. The reanalysis indicates that a wage rise in the controlled sector is more likely to produce a fall in total employment & in real income. In Raising Wages in the Controlled Sector: A Comment on Elliott, Frances Stewart & John Weeks find Elliott's analysis confusing or flawed in several respects, eg, the discussion of capital, the analysis of substitutability between capital & labor in sector productivity, & the dependence on questionable empirical estimates about substitution & its elasticity. Elliott would have found the suggested increase in employment had he used lower estimates of capital-labor substitutability. 1 Table, 1 Figure. D. Dunseath.