Economics, Econometrics and Finance
4 years ago

Foreign capital boosts wages and reduces unemployment for unskilled labor.

Economic Modelling
Foreign capital inflow, skilled–unskilled wage inequality and unemployment of unskilled labour in a fair wage model
Sarbajit Chaudhuri, Dibyendu Banerjee

Paper Summary

The article explains how foreign capital coming into a country can affect the wages and unemployment of skilled and unskilled workers. When foreign capital flows in, it helps unskilled workers but can also impact the wage gap between skilled and unskilled workers. Unemployment for both types of workers can be influenced by the efficiency of skilled workers.

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