TITLE:
On a Theme by Williamson: A Stochastic Model for the Evolution of Global Labor Markets since 1830
AUTHORS:
Fariba Hashemi
KEYWORDS:
Evolution of Global Labor Markets, Spatial Dynamics, Stochastic Analysis
JOURNAL NAME:
Modern Economy,
Vol.2 No.4,
September
21,
2011
ABSTRACT: The cross-sectional distribution of wages has so
far been neglected compared to the study of income differences across countries
over time. We propose a stochastic model, built on the theory of diffusion
processes, to describe the evolution of global labor markets since 1830. The
model is applied to empirical data collected by Williamson, in order to
describe the level and variation of cross-country wages. The empirical application
validates the proposed method.