If the population of the United States suddenly grew because of a large wave of immigration,...

If the population of the United States suddenly grew because of a large wave of immigration, what would happen to wages? What would happen to the rents earned by the owners of land and capital?

Expert Solution

If the population of US increases due to immigration, then it means that the supply of labour increases. An increase in supply of labour would shift the supply curve of labour to the right.

This rightward shift would lead mean a decrease in wages. Also otherwise as well when th esupply of labour would be large then wages would reduce because when unemployment would be high or competition is more , people are willing to work at lower prices.

So the wages tend to decline.

On the other hand , the rent earned by owners of capital and land would increase because to accomodate such large labour force , the capital and labour needs to be increased which would in a way benefit the owners of capital and land.

More people would want land for housing and purposes which would increase the earnings of the land owners.

Morever in the workarea, because the labour has increased the capital would also be increased in the proportion in order to keep the output constant. So the capital owners are also better off.

Hence both the land and capital owners are better off while the wages would reduce and competition among the workers increase.

(You can comment for doubts)

Rahul Sunny answered 2 years ago

After years of rapid growth, illegal immigration into the United States has declined because of the...

After years of rapid growth, illegal immigration into the United States has declined because of the recent recession and better economic conditions in the countries south of the border. But California still accounts roughly 20% of the nation undocumented immigrants. If you take a random sample of 50 undocumented immigrants, what is the probability that more than a quarter (25%) of them live in California? (HINT: Large sample proportion – use Normal approximation.) Define p = proportion of all undocumented...

which ethnic group in the United States grew the fastet during the 1990

Skill-biased Immigration. (a) Let us consider the immigration dynamics between the United States and Mexico. The...

Skill-biased Immigration. (a) Let us consider the immigration dynamics between the United States and Mexico. The minimum wage of the U.S. is $7.25, while that of Mexico is $5.1 in U.S. dollars. Let the return to skills in Mexico be two times of that of the U.S., partly because the U.S. (Mexico) is relatively abundant (scarce) in the availability of skilled workers. In other words, if we plot skills x on the horizontal axis and hourly wage y on the...

2. Consumption spending is a large percentage of GDP in the United States. The ageing population...

2. Consumption spending is a large percentage of GDP in the United States. The ageing population is a demographic certainty. Explain how ageing demographics in the U.S. will affect the economy for each of the two views discussed below. a. Using key macroeconomic measurements and models explain how ageing demographics traditionally has already affected several economies (such as Japan and Europe. b. Now explain how ageing demographics will affect U.S. consumers and U.S. consumers and U.S. businesses if older people...

Suppose that a foreign citizen and resident is considering immigration into the United States and owns...

Suppose that a foreign citizen and resident is considering immigration into the United States and owns both appreciated assets (value greater than basis) and depreciated assets (value less than basis) that she is thinking of selling. What practical tax planning steps should be suggested?

1. Some experts estimated that national health spending in the United States grew at 1% in...

1. Some experts estimated that national health spending in the United States grew at 1% in excess of the growth rates of GDP. Assume that this trend would persist for the foreseeable future, and given the fact that the share of GDP on health spending stood at 18% in 2016, what would become the share in 2064, 45 years from now (and 48 years from 2016, the base year), when most of you would enter the traditional retirement age? We...

As an economist for the United States, how would you set the guidelines for immigration. How...

As an economist for the United States, how would you set the guidelines for immigration. How do you determine the right number or percentage of people permitted into our country? I am interested in hearing how you would make such a decision. What factors would you consider? What are the potential implications with too little or too much regulation? Are other countries handling immigration policy better than the United States?

Is the long term survival of the United States economy at risk because of the United...

Is the long term survival of the United States economy at risk because of the United States government’s level of debt and the amount of the debt held by foreign entities such as China? Why or why not? no less than 250 words in length, make at least one reference to your text or other course materials and provide in-text citations. As you reference information from a source, be sure to provide APA citations in text and at the end...

The United States prides itself on being an “immigration nation.” Yet throughout history, a succession of...

The United States prides itself on being an “immigration nation.” Yet throughout history, a succession of different immigrant groups has faced antagonism: Chinese, Irish, Italians, Japanese, Germans, and Jews. Now Mexicans and Muslims face hostility. Why does this happen? What can be done about it?

1. The current population of the United States is 328.2 million with 2.2% of the population...

1. The current population of the United States is 328.2 million with 2.2% of the population is engaged in R&D at an efficiency rate of 1/500 per million persons per year. (a) If R&D is the only source of total-factor productivity growth what is the growth rate of labor efficiency in the United States? (b) If the growth rate of total factor productivity is 0.75% per year, what is the value of α in the Cobb-Douglas production function?

Question