SHORT RUN POLICY ANALYSIS OF EMPLOYMENT, FOOD PRICE AND RURAL-URBAN MIGRATION FOR A LABOUR-ABUNDANT DEVELOPING ECONOMY

Abstract

The purpose of this study is to derive a linear model for food price determination, rural-urban migration, and non-agricultural sector's employment change. The linear model is used to analyse the effect of employment policies on food price, internal migration and employment. It is shown that the model can be conveniently used to translate macroeconomic policy effects into corresponding two-sectoral economics effects. Although three equilibrium schedules, instead of two, comprise the model, its manipulation proves to be as flexible as the more familiar IS-LM model in policy impact analysis.