Wages, Profitability, and Growth in a Small Open Economy
May 1, 1990
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Summary
This paper examines issues raised by the evolution of a rapidly growing small open economy—Singapore—from a labor-intensive, low-technology production base to a capital-intensive, high-technology, knowledge-and-skill-intensive emphasis as it approached the limits of its resource constraints in the labor market. In order to analyze the process of restructuring a model of endogenous growth for a small open economy that is driven by increases in labor productivity from learning and that allows for the dynamic acquisition of comparative advantage is developed. In this framework the effects of various policies and exogenous shocks on the direction and pace of restructuring are investigated.
Subject: Employment, Labor, Labor costs, Labor force, Wage adjustments, Wages
Keywords: Employment, Global, high-technology good, Labor costs, Labor force, learning by doing, open economy, physical capital, productivity increase, rate of return, shifts production, Wage adjustments, wage-correction policy, Wages, WP
Pages:
40
Volume:
1990
DOI:
Issue:
045
Series:
Working Paper No. 1990/045
Stock No:
WPIEA0451990
ISBN:
9781451974188
ISSN:
1018-5941
Notes
Also published in Staff Papers, Vol. 38, No. 1, March 1991.
