This paper analyzes the macroeconomic effects of fiscal and labor market policies in developing countries. The basic framework considers a small open economy with a large informal production sector and a heterogeneous work force. The labor market is segmented as a result of efficiency considerations and minimum wage laws. The basic model is then extended to account for unemployment benefits, income taxation, and imperfect labor mobility across sectors. The analysis indicates, among other results, that a reduction in unemployement benefits has a positive effect on output of tradable goods by lowering both the level of efficiency wages and the relative rent captured by skilled workers.

Michael Reich PART I PIONEERING STATEMENTS `Low-Income Employment and the Disadvantaged Labor Force', and `Quantitative Analysis of Worker Instability in the Low-Income Labor Market' in Internal Labor Markets and Manpower Analysis, Chapter 8 and Appendix, Lexington, MA: D.C. Heath and Company, 163-83, 184-88 3 (26) Peter B. Doeringer Michael J. Piore `The Dual Labor Market: Theory and Implications', in David M. Gordon (ed.), Problems in Political Economy: An Urban Perspective, Lexington, MA: D.C. Heath and Company, 90-94 29 (5) Michael Piore `A Theory of Labor Market Segmentation', American Economic Review, 63 (2), May, 359-65 34 (7) Michael Reich David M. Gordon Richard C. Edwards `The Period of Consolidation: World War II to 1970s' and `Evidence for the Segmentation Hypothesis' excerpts from Chapter 5, `The Segmentation of Labor: 1920s to the Present', in Segmented Work, Divided Workers: The Historical Transformation of Labor in the United States, Cambridge: Cambridge University Press, 185-215, notes, references 41 (40) David M. Gordon Richard Edwards Michael Reich PART II EARLY DEBATES `An Empirical Study of Labor Market Segmentation', Industrial and Labor Relations Review, 28 (4), July, 508-23 81 (16) Paul Osterman `The Challenge of Segmented Labor Market Theories to Orthodox Theory: A Survey', Journal of Economic Literature, 14 (4), December, 1215-57 97 (43) Glen G. Cain `Structured Labour Markets, Worker Organisation and Low Pay', Cambridge Journal of Economics, 2 (1), March, 17-36 140 (20) Jill Rubery `Male Occupational Standing and the Dual Labor Market', Industrial Relations, 19 (1), Winter, 34-49 160 (16) Sam Rosenberg `Segmentation, Duality and the Internal Labour Market', in Frank Wilkinson (ed.), The Dynamics of Labour Market Segmentation, London and New York, NY: Academic Press, 3-20, references 176 (20) Paul Ryan `Economic Dualism and Employment Stability', Industrial Relations, 22 (3), Fall, 410-18 196 (11) Robert Buchele PART III THEORETICAL MODELS AND ECONOMETRIC EVIDENCE `Wages and Employment in a Segmented Labor Market', Quarterly Journal of Economics, 100 (4), November, 1115-41 207 (27) Ian M. McDonald Robert M. Solow `A Theory of Dual Labor Markets with Application to Industrial Policy, Discrimination, and Keynesian Unemployment', Journal of Labor Economics, 4 (3, Part I), 376-414 234 (39) Jeremy I. Bulow Lawrence H. Summers `Labor Market Segmentation Theory: Reconsidering the Evidence', in William Darity, Jr. (ed.), Labor Economics: Problems in Analyzing Labor Markets, Chapter 5, Boston, MA: Kluwer Academic Publishers, 141-80 273 (42) William T. Dickens Kevin Lang PART IV INSTITUTIONAL APPROACHES `Getting a Good Job: Mobility in a Segmented Labor Market', Industrial Relations, 30 (3), Fall, 396-416 315 (21) Howard Wial `Internal and External Labour Markets: Towards an Integrated Analysis', in Jill Rubery and Frank Wilkinson (eds), Employer Strategy and the Labour Market, Chapter 1, Oxford: Oxford University Press, 37-68, references 336 (35) Jill Rubery `Divide and Conquer in Australia: A Study of Labor Segmentation', Review of Radical Political Economics, 27 (1), 25-70 371 (48) Robert Drago PART V IMMIGRANTS, GENDER AND RACE/ETHNICITY `Spatial Mismatch and Labor Market Segmentation for African-American and Latina Women', Economic Geography, 68 (4), October, 406-31 419 (26) Sara McLafferty Valerie Preston `Hispanic Immigration and Labor Market Segmentation', Industrial Relations, 27 (2), Spring, 195-214 445 (20) Gregory DeFreitas `Labor Market Segmentation: African American and Puerto Rican Labor in New York City, 1960-1980', in James B. Stewart (ed.), African Americans and Post-Industrial Labor Markets, Chapter 10, New Brunswick, NJ and London: Transaction Publishers, 205-23 465 (20) Andres Torres Name Index 485 Acknowledgements vii An introduction by the editor to both volumes appears in Volume I PART I OVERVIEWS `From Segmentation to Flexibility', Labour and Society, 14 (4), October, 363-407 3 (45) Sam Rosenberg `Rethinking Employment', British Journal of Industrial Relations, 33 (4), Special Issue, December, 563-602 48 (40) Peter Cappelli `Changes in the Structure and Quality of Jobs in the United States: Effects by Race and Gender, 1973-1990', Industrial and Labor Relations Review, 48 (3), April, 420-40 88 (21) Maury B. Gittleman David R. Howell `Labour Markets and Flexibility in the 1990s: The Europe-USA Opposition Revisited', International Review of Applied Economics, 13 (3), September, 269-79 109 (11) Francesca Bettio Samuel Rosenberg `Lousy and Lovely Jobs: The Rising Polarization of Work in Britain', Review of Economics and Statistics, 89 (1), February, 118-33 120 (19) Maarten Goos Alan Manning PART II THE GROWTH OF TEMPORARY JOBS IN EUROPE `Temporary Jobs: Stepping Stones or Dead Ends?', Economic Journal, 112 (480), June, F189-F213 139 (25) Alison L. Booth Marco Francesconi Jeff Frank `Temporary Employment in Europe: Characteristics, Determinants and Outcomes', Brussels Economic Review, 48 (1-2), 13-41 164 (29) Anna Cristina D'Addio Michael Rosholm `The Incidence of Temporary Employment in Advanced Economies: Why is Spain Different?', European Sociological Review, 22 (1), February, 61-78 193 (20) Javier G. Polavieja PART III GENDER, IMMIGRANT STATUS AND RACE `Female Dual Labour Markets and Employee Benefits', Scottish Journal of Political Economy, 52 (1), February, 18-37 213 (20) T. Ghilarducci M. Lee `Immigration, Labor Market Mobility, and the Earnings of Native-Born Workers: An Occupational Segmentation Approach', American Journal of Economics and Sociology, 65 (2), April, 313-45 233 (36) Roberto Pedace PART IV ECONOMETRIC CONTROVERSIES REDUX `Segmented Labour Markets: Theory and Evidence', Journal of Economic Surveys, 12 (1), 63-101 269 (39) Marianthi Rannia Leontaridi `Segmented Labour Markets: A Critical Survey of Econometric Studies', Caledonian Business School, Glasgow Caledonian University Working Paper No. 36, October, 2-30, references 308 (37) Emily Thomson PART V FLEXICURITY `Labour Market Flexibility and Decent Work', Presentation at UNDESA Development Forum on Productive Employment and Decent Work, 8-9 May, 2-15 345 (14) Gerry Rodgers `Employment and Decent Work in the Era of ``Flexicurity''', UNDESA Development Forum on Productive Employment and Decent Work, Working Paper No. 32, ST/ESA/2006/DWP/32, September, 1-23 359 (24) Robert Boyer Name Index 383.

The Dynamics of Labour Market Segmentation is a collection of different papers about the importance of differentiation between groups of workers and the development of employer strategies for controlling the labor process in the market. The book is divided into five parts. Part I discusses the nature of segmentation, duality, the internal labor market, internationalization, and discrimination. Part II tackles the industrial transformation and the evolution of dual labor markets and the paternalism and labor market segmentation theory, and Part III deals with topics such as entrepreneurial strategies of adjustment and internal labor markets; artisan production and economic growth; and outwork and segmented labor markets. Part IV covers the construction of women as second-class workers and the social reproduction and the basic structure of the labor market; Part V explores the labor market segmentation and the business cycle and the relationship between employment and output. The text is recommended for entrepreneurs who wish to understand the labor market as well as social scientists who would like to know the implications of the labor market segmentation not only for the marketplace but also for society as a whole.