Rural-urban migration, urban unemployment and underemployment, and job-search activity in LDCs

Abstract

This paper analyzes unemployment and underemployment in LDCs within a quantity adjustment framework. Four extensions of the Harris-Todaro model are made, including allowances for more generalized job-search behavior, an urban traditional sector, preferential hiring by educational level, and labor turnover considerations. The result of these modifications is a much lower predicted unemployment rate, which accords more closely with actual observations. Some additional policy implications deriving from the analysis are noted.