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Unemployment, rural–urban migration and environmental regulation
Author(s) -
Kuralbayeva Karlygash
Publication year - 2018
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/rode.12360
Subject(s) - economics , unemployment , subsidy , general equilibrium theory , developing country , applied general equilibrium , rural area , agriculture , labour economics , tax incidence , macroeconomics , economic growth , public economics , tax reform , geography , indirect tax , medicine , archaeology , pathology , market economy
Abstract This paper develops a general equilibrium model that incorporates specific features pertaining to developing countries: a large informal sector and rural–urban migration. A calibrated version of the model is used to study the effects of energy tax changes and a reduction in agricultural‐sector energy subsidies on labor market outcomes. The results indicate that the incidence of energy taxes is partly shifted on to the rural sector through rural–urban migration. The results thus highlight the importance of modeling the features particular to developing countries and the economic general equilibrium effects when assessing the impact of environmental taxation in those countries.