Saturday, June 15, 2013
On Why Immigration DOESN'T Depress Wages
a) Immigrants often represent a different type of labor. As economist Ben Powell frequently points out, American labor tends to cluster around the mean for both wages and skill sets, while immigrants, they, on the other hand, have a tendency to cluster around either the very high (70% of PhDs in the country are foreign born) or very low (a majority of farm hands and housekeepers are also foreign born) in both of these two variables and, so, hence, the two populations tend to compete infrequently.............And b) it isn't just the supply (of labor) curve that is being modified here. The demand curve (for labor, goods, and services) is also being modified and the end result, according to the Journal of Economic Perspectives, is essentially a wash (only the wages of high school drop-outs are truly effected and even with them it is only an 8% decrease).