Pollution control under an urban binding minimum wage

In this paper, by using a generalized Harris-Todaro model that incorporates an urban non-polluting sector, and supposes a dual economy inherent in an LDC, we examine the backward incidence of pollution control on some key variables of interest. Given a relatively capital intensive polluting sector, stricter pollution controls may result in a reduction in unemployment, an increase in national income and migration from the agricultural sector. The results from our model differ from that of a previous model that demonstrated a reverse flow of labor to the agricultural sector from stricter pollution controls.