The gap between rich and poor countries has grown over the last century. A hundred years ago the richest nation was 11 times wealthier than the poorest. Now it is 50 times. The labour markets are increasingly seen as pivotal in the fight against poverty. However, what is known about rich countries’ labour markets is not necessarily applicable to labour markets in less rich countries. For example, while the unemployment rate is a well accepted indicator of labour market performance in developed countries, the unemployment rate is scarcely relevant in economies where people cannot afford to be unemployed.

These considerations raise the issue of how we can understand labour markets in developing countries, how they compare with labour market in developed nations and how they perform in the global economy.

The objectives of the new subject are:

• To understand the concept of labour demand and labour supply in the context of economic development;
• To appreciate the importance of labour market segmentation for the functioning of labour markets in developing countries;
• To understand the way wages are set in different institutional set ups;
• To relate issues of internal and international migration to the way wages are set across the globe;
• To appreciate the importance of trade and technology on wages, income levels and employment in developed and developing countries;
• To empirically address the importance of structural change in development with a focus on human resources and the labour markets;
• To address the issue of institutional reforms and to understand how this issue relate to the desirability of labour markets outcomes.