Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/203519
Authors: 
Stijepic, Denis
Year of Publication: 
2019
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2019: 30 Jahre Mauerfall - Demokratie und Marktwirtschaft - Session: Development Economics IV No. D21-V2
Abstract: 
Cross-sector labor reallocation is associated with costs at the micro level ranging from the costs of geographical relocation and skill change/adaptation to unemployment. We show that monotonous reallocation paths minimize the aggregate reallocation costs in the three-sector framework (relating to agriculture, manufacturing, and services), where we assume that the aggregate reallocation costs are indicated by the strength of cross-sector labor reallocation. By using this result and the (qualitative) labor-reallocation "laws" based on the theoretical/empirical literature consensus, we derive the cost-minimizing development strategy for a developing country. We use these results to discuss some well-known structural/trade strategies and compare the historical reallocation costs across countries.
Subjects: 
employment structure
long-run dynamics
costs, industrial/structural policy
uncertainty
dynamic optimization
calculus of variations
geometry
vector
simplex
JEL: 
O14
O41
O21
O24
C61
Document Type: 
Conference Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.