The Harris Todaro model mainly came up due to the rising problems in tropical Africa which was mainly rural urban migration and urban unemployment. The migration was mainly caused due to the differences in the expected wages by the labourers. It was seen that the minimum urban wage had been higher than the rural wages which is the leading reason for growing levels of unemployment. Thus to remove this unemployment , Harris Todaro has introduced the concept of lumpsum tax so as to get a minimum wage. ASSUMPTIONS 1) There are two sectors in an economy which is the rural sector and the urban sector.
According to Zolberg, there are two international migration theories. The first one is micro-analytic theory. This perspective approaches to international migration from classical economic view. According to the theories driven by this perspective, wage differentiates between sending and receiving countries are the major reasons for people to migrate. However, by looking at the discussions as we do above like historical ties, state intervention etc.
The labor surplus theory is one of main theory. Lewis (1955) debates that the dynamic force at the back of MSE development is extreme labor source or supply, which cannot be engaged in the excessive labors in public sector or large private companies/ enterprises / and is forced into MSEs in spite of inadequate pay and low productivity. Perhaps, the MSE sector develops has immediate reaction or response to the growth in unemployment, working as last opportunity for people who are incompetent to find employment in the formal sectors. Corresponding to this theory, micro and small enterprises are anticipated to grow in the period of economic crisis, when the formal sector shrink or grows too slowly to engage the labor force. In spite of this, when formal employment grows, the MSE sector is thought to shrink again and thus improves an anti-cyclical correlation with the formal
cities that resulted in a spatial mismatch between workers and jobs when employment decentralized (Teitz and Chapple, 1998). In essence, structural changes in the economy have caused poverty. However, these are some of the empirical evidence determines the inter-relationship between these two contrasting views. Because considerably better service levels. Those developing countries which have a relatively high per capita GDP have already provided a relatively high percentage of their urban households with access to water and sanitation services - two of the important indices of the quality of urban life (Bhattacharya,
If a different PLI is used, for example 20 to 30 percent higher from the rural sector, a much higher incidence of urban poverty will be recorded. Mok, Gan and Sanyal (2007) stated that PLI has two shortcomings in Malaysia. Firstly it is based on consumption expenditure and secondly, the data on household income is less reliable as it is often under-reported and influenced by the timing of data
The slow pace with which planning, enforcement and implementation catches on, ensures that these settlements get enough time to turn into full-fledged communities, often contributing to the city by means of their enterprise or labour, albeit as encroachers, with no secure tenure but also not one to be wished away. Hence a growth oriented development, results in the displacement of these informal settlements as an inevitable outcome, assuming significance in light of urban development becoming more accommodating of the poor and their settlements over the years. Mumbai is the commercial and financial capital of India and home to over 16 million people. It generates 1/3 of the country’s tax revenue and 5% of its GDP. However, of the entire population, approximately six million live in slums, alongside roads, railway tracks and on pavements.
In the research conducted by Garofoli (1994) and Audretsch and Fritsch (1994) was discovered that unemployment is adversely related to new-firm startups, that is, as new businesses are established employability is stimulated and unemployment reduces substantially. Similarly, Lucas (1978) and Jovanovic (1982) observed that increase unemployment in the society is related to a low degree of entrepreneurial activities, that is, where tendency to set up enterprises is low; the degree of unemployment would be very high. The consequence of the above assertion is that those who are unemployed tend to remain unemployed because they have lower endowments of human capital and entrepreneurial talents required to start and sustain new firms to keep them going. A low degree of entrepreneurship culture and skills in any society may be an outcome of a low economic growth, which also reproduces higher levels of unemployment (Audretsch, 1995, Oladele, P.O. et al,
In-depth study of socio-economic factors helps us understand the causes of the migration. There is a question of whether the distribution of land and other assets affect migration. There is found a positive link between employment types, family members in the work force, years of education, land holdings and migration. Other studies
The main points are described below: • The rural-urban migration and population growth are two factors contributing to spatial city fragmentation through illegal settlements. • Lack of institutional consideration through the “laisser-faire” approach leads to settlements deterioration and self-housing initiations. • Legalization of illegal settlements through formal projects on irregular structures has led to a mixed urban configuration that incorporates legal and illegal tenancy informally constructed. This has become a common urban pattern and a natural growth in the city. • Formal housing programs seemed to be diverse but benefiting only the middle and high social classes leading to a formal form of social exclusion.
However, the major problem faced by the urban areas is the perennial problem of urban poverty leading to urban unemployment. Urban poverty may be accounted to the poor interventions to engage sufficiently with rural poverty or due to failure of various policies or strategies to reduce rural poverty. This trend is predominant across cities of various developing countries. This phenomenon is changing the entire urban face by introducing two major aspects/dimensions. The first is that the poor are being forced to live in slums to fulfill the residential foothold and the other aspect is that the poor are being forced to work in the informal sector to earn a living.