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Political Economy of Racism-page13

Political Economy of Racism-page13 - each year(Borjas...

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Tuesday November 1, 2011 Projet presentations start on the 29 th of November 1, 2011 Final Paper is due December 8 th . Next Quiz is the 17 th . - On Takaki chapter 9 - Projects Begin November 29 th ! - Paper is due December 8 th ! Migration and Immigration: - Labor mobility: Is it a good thing? Why? Or why not? - Migration or immigration: Is it rational? - Under what conditions is immigration most likely to cause job loss? Is the job loss permanent? Labor Mobility - Improves match between worker and firm. - Helps labor market clearing. - (internal migration) Reduces wage differentials across regions and improves labor market efficiency. - Extent: Nearly 4% of workers in early 20s switch jobs in any given month, 3% across state lines, and nearly 1.4million documented and undocumented workers enter the US
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Unformatted text preview: each year. (Borjas, 2008). -Effect: Internal migration raises wages over 10%. -Internal migration costs young workers $250,000. -Determinants of migration: o Income differential between destination and origin (+2%) o A 10% increase in employment growth in the origin (-2%) o Doubling distance between origin and destination (-50%). -Has also been found to depend on worker characteristics: o Age (-) o Education (+) -Within the US (African Ameircans 1900-1950; California post war). Rationality for choosing to migrate: -What are the costs? o Moving expenses. o Language barriers. o Risk. o Social/psychic cost. o Lost wages? Migration and Immigration: Labor Market Effects -Simplest model: Workers are substitutes. Short term job loss, long term adjustment (adjustment costs)....
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