Profit-Sharing and International Capital Mobility in Developing Countries |
| |
Authors: | Chi-Chur Chao,& Eden S. H. Yu |
| |
Affiliation: | The Chinese University of Hong Kong |
| |
Abstract: | This paper uses a general equilibrium model incorporating rural–urban migration to analyze and contrast the short- and long-run effects of profit-sharing. Specifically examined are the effects of profit-sharing on rural–urban migration, the degree of competition among urban firms, and international mobility of capital. It is found that although profit-sharing may raise urban employment in the short run, the scheme reduces urban employment and lowers the inflow of foreign capital in the long run. |
| |
Keywords: | |
|
|