Kaldorian Disaggregation, Temporary Migration and Welfare: Theory and Calibration

Cai, T, Lai, J, Hazari, B and Mohan, V 2018, 'Kaldorian Disaggregation, Temporary Migration and Welfare: Theory and Calibration', Pacific Economic Review, vol. 23, no. 2, pp. 193-221.


Document type: Journal Article
Collection: Journal Articles

Title Kaldorian Disaggregation, Temporary Migration and Welfare: Theory and Calibration
Author(s) Cai, T
Lai, J
Hazari, B
Mohan, V
Year 2018
Journal name Pacific Economic Review
Volume number 23
Issue number 2
Start page 193
End page 221
Total pages 29
Publisher Wiley-Blackwell Publishing Asia
Abstract In this paper we examine a four-good, four-factor model of trade with two agents: domestic residents and temporary migrants. This modelling framework has three important features: first, there are two tradable and two non-tradable goods; second, there exists Kaldorian disaggregation in consumption; third, the structure incorporates a combination of price adjustment. The results emphasize the influence of factor accumulation at constant traded goods prices on the variable prices of non-traded goods. We also analyse the impact of temporary migration and other structural parameters on domestic welfare. To highlight our results, our model is calibrated on a typical small open economy, Hong Kong, and a wide array of situations are presented when temporary migration and Kaldorian disaggregation can reduce domestic welfare in response to exogenous shocks.
Subject Economics not elsewhere classified
DOI - identifier 10.1111/1468-0106.12135
Copyright notice © 2016 John Wiley & Sons Australia, Ltd
ISSN 1361-374X
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