In the context of a segmented economy in which the urban unemployed subsist in informal-sector activities, Earl Grinols (1991) has recently questioned conventional wisdom whereby foreign investme nt with repatriated earnings is necessarily immiserizing for the host country. In this paper, the...

A welfare ranking of alternative commercial policies is constructed for the mobile capital Harris-Todaro economy. It is sh own that, despite the presence of unemployment, most noninterventioni st policies suggested by the competitive model of gains from trade ca rry over to the mobile capital...