Abstract
This study examines the effects of policy changes and improvements in the agritourism sector in a developed country with free trade and capital movement. This country consists of two regions: an urban area where the manufacturing sector is located and a rural area where both the agricultural and agritourism sectors are located. We consider free labor mobility between two areas and the structural, frictional unemployment in the urban area. We demonstrate that if agritourism is environmentally friendly, a reduction of the ratio of agricultural goods to touristic services in the agritourism sector, an enhancement of labor productivity of tourism sector, and technological improvements about environmental protection in either manufacturing or agritourism sector will enhance the level of the natural environment, urban and rural wage rates, and domestic welfare while reduce the urban unemployment rate and urban-rural wage gap. Labor inflow improves the natural environment and domestic welfare but the effects on urban-rural wage gap and urban unemployment rate are not clear.
Details
Presentation Type
Paper Presentation in a Themed Session
Theme
KEYWORDS
Agritourism, Urban-rural migration, Natural Environment, Unemployment
