Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 42, Problem 12DQ
To determine
The IACs openness to the DVCs labor force.
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Consider a situation in which there are just two countries: an Origin, and a Destination country.
Wages in the origin country are given by:
Wo=1+2s
Wages in the destination are given by:
Wd=7+1s
where s are years of schooling.
Migrating from the Origin to the Destination country requires paying a fixed cost of 1,
corresponding to a Visa fee.
a. Draw a figure in which the y-axis represents wages net of migration costs in each of
the countries, and the x-axis represents years of schooling.
In what respect is the economic decision to move across international borders an investment decision? Why do economic migrants move to some countries, but not to others? Cite an example of an explicit cost of moving; an implicit cost of moving. How do distance and age affect the migration decision? How does the presence of a large number of previous movers to a country affect the projected costs and benefifits of subsequent movers?
In what respect is the economic decision to move across international borders an investment decision? Why do economic migrants move to some countries but not to others? Cite an example of an explicit cost of moving; an implicit cost of moving. How do distance and age affect the migration decision? How does the presence of a large number of previous movers to a country affect the projected costs and benefits of subsequent movers?
Chapter 42 Solutions
Economics (Irwin Economics)
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