The paper embeds child labor in a standard two-sector general-equilibrium model of a small open economy facing perfectly competitive markets, efficiency wages, and free-trade. The modern sector produces a homogeneous good using skilled adult labor and capital, and offers effort-based efficiency...

Unemployment has become a focal topic of discussion in applied economics. In this paper, we provide an integrated overview of recent theoretical studies that link unemployment problems to spatial economics. We introduce four mechanisms commonly used to consider unemployment in this field:...

We investigate the issue of offshoring in a model of two countries and one sector of increasing returns to scale. Our model uncovers that in a setting of footloose capital, offshoring occurs and evolves in an inverted-U pattern when transport costs decline. This result can explain China's...