General Equilibrium Effects of Land Market Restrictions on Labor Market: Evidence from Wages in Sri Lanka
نویسندگان
چکیده
Taking advantage of a historical quasi-experiment in Sri Lanka, this paper provides evidence on the effects of land market restrictions on equilibrium wage and its spatial pattern. For identification, we exploit the effects of historical malaria prevalence on the incidence of land restrictions through the availability of ‘crown land’. The results show that there is important spatial heterogeneity in the effects of land restrictions. There is no perceptible effect in areas close to, or far away from the urban center, but land restrictions have strong negative effect on wages in the intermediate zone. The elasticity of wage with respect to land restrictions is -0.48 in the intermediate zone. JEL Codes: O10, J31, J61
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