Hamid Beladi

Urban unemployment and non-immiserizing growth

Abstract One purpose of this paper is to show that in the Harris-Todaro economy, economic expansion can not be immiserizing. Another purpose of this paper is to examine the implications of economic expansion for urban unemployment as well as sectoral outputs for the case of non-neutral technical change. Finally, it is shown that a damaging property of the Harris-Todaro model, that capital accumulation causes unemployment to rise whereas labor growth causes it to fall, is at least partially rectified by the incorporation of land as a scarce factor in the agricultural sector.

Protection and the gainful effects of foreign capital

An increased foreign capital inflow into a protected sector is generally immiserizing. We show that if the protected sector produces an intermediate input, positive welfare effects may emerge. A striking result is that it might lead to an increased import-demand for the intermediate input which is a substitute for the product of the import-competing sector.

Foreign capital, unemployment and national welfare

Abstract We consider a situation where foreign capital is allowed to flow only into the export-processing zone of an economy characterized by unemployment and pursuing protectionary policy. We derive conditions under which growth induced by an increase in the flow of foreign capital will be immiserizing. The results are derived when foreign capital does not directly flow into the protected sector but alters the composition of outputs in the other traded sectors through inter-sectoral reallocation of other resources.

Possibility or impossibility of paradoxes in the small country Harris-Todaro framework: A unifying analysis

Abstract In this paper, we argue that the Harris-Todaro (HT) framework sometimes satisfies an “envelope” property, which makes it work like a full-employment Heckscher-Ohlin-Samuelson (HOS) model. Then, the HT structure produces very similar results as one gets in the standard HOS framework. Differences arise because the “envelope” condition may break down. We show how several celebrated results in the HT structure can have this reinterpretation.

Tariff-induced capital inflow and welfare in the presence of unemployment and informal sector

Abstract The co-existence of rural–urban migration and persistent urban unemployment is a common feature in developing countries. In this paper we draw on the Harris–Todaro model and extend it to include an urban informal sector where the product of the informal sector is used as an industrial input in the urban formal sector. We derive and contrast various welfare effects of tariff-induced capital inflow. Also, we analyze the welfare implications of employment subsidy as the policy instrument in the presence of international capital mobility.

Maritime trade, biological invasions, and the properties of alternate inspection regimes

We analyze the problem of preventing biological invasions caused by ships transporting internationally traded goods between countries and continents. Specifically, we ask the following question: should a port manager have a small number of inspectors inspect arriving ships less stringently or should this manager have a large number of inspectors inspect the same ships more stringently? We use a simple queuing-theoretic framework and show that if decreasing the economic cost of regulation is very important then it makes more sense for the port manager to choose the less stringent inspection regime. In contrast, if reducing the damage from biological invasions is more salient then the port manager ought to pick the more stringent inspection regime.

Product Versus Process Patents: A Theoretical Approach

Abstract In this paper we develop a simple theoretical model to focus on the debate related to the granting of product patents in the developing countries. We discuss conditions under which “sleeping patents” might emerge. We argue that, for “poor” countries, allowing product patents cannot be justified on pure economic grounds.

Environmental pollution and world trade

Abstract In this paper we present a model that highlights the relationship between international trade and environmental pollution. It includes a small open economy that produces a domestic composite good and imports another composite good and energy products. The pollution is created by local production, global production and transportation. Given this model we demonstrate that free trade within the current political and economic context may produce a suboptimal level of welfare. The rationale is based upon the argument that transportation is energy-intensive and that, therefore, trade itself is a source of pollution. Consequently, under certain global conditions the introduction of an energy tariff in a small open economy raises social welfare and is superior to free trade. A consumption tariff adopted by a single nation will not have similar consequences because it has no impact upon local usage. However, when a consumption tariff is globally adopted there is the opportunity for a net benefit. Finally, we argue that a global tariff that raises both the price of energy and the price of the imported composite good may generate the greatest increase in welfare by reducing both energy-intensive production and energy-intensive trade.

Unemployment and immiserizing transfer

This paper reexamines the welfare effects of international transfers in a two country model in the presence of unemployment which is generated by an exogenously specified real minimum wage rate. In this context we have found the necessary conditions for the occurrence of paradoxical as well as normal results on employment as well as welfare.

The Stolper-Samuelson Theorem in a Wage Differential Framework

We develop a wage differential model with a unionized and a non-unionized informal sector for a small open economy. The unionized wage rate adjusts to a cost of living index and the informal wage is market-determined. In this structure, a Stolper-Samuelson type result holds without any assumption regarding factor-intensity ranking.