In this paper, the authors show how an interlinkage between the credit and output markets is an endogenous outcome of credit market imperfections. Also, such interlinkages are Pareto optimal. This is worked out under the assumption of infinite availability of funds with the money lender. If,...

This paper considers a dual economy in which the urban sector has open unemployment while the rural sector has surplus labor. The model is a n extension of the Harris-Todaro (1970) framework as developed by Kul B. Bhatia (1979), where full employment is said to exist when open u nemployment and...