lecture4_Sept14_slides

lecture4_Sept14_slides - Income, Poverty, and Health...

Info iconThis preview shows pages 1–15. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Income, Poverty, and Health Insurance Coverage: 2010 n http://www.census.gov/prod/2011pubs/p60-239.pdf n Released annually by the Census Bureau n Contains the official estimates of income, poverty, and health insurance trends September 14, 2011 Explanations for the Declining Wages of Low Skill Workers 5 Reasons that lower class wages have stagnated n Supply factors? Education of workers Immigration n Demand factors? Technological change International trade n Institutional factors (non-market)? Decline in unions Decline in minimum wage Supply Side Explanations for Declining Wages of Low-Skill Workers 7 Market Labor Supply and Demand: Low-Skill Workers # of Low-Skill Workers Hired Wage Rate for Low- Skill Workers D1 S1 W1 Q 1 S2 W 2 Q 2 Supply Side Explanations n 1. Declines in education Relative scarcity of high-skilled vs. low-skilled workers impacts relative wages How does the wage trends fit with the trend in education (and supply of high-skilled workers) in the US? Supply Side Explanations n 2. Immigrant inflows IDEA/THEORY: If immigrants are less educated (on average) than native born, supply of low-skilled workers will increase and low-skill wages will decrease. FACTS: Percent of immigrants with low levels of education has increased over time. In 2000, Immigrants were 13% of working age population but 28% of HS dropouts in working age population After World War I, laws were passed severely limiting immigration. Only a trickle of immigrants has been admitted since thenBy keeping labor supply down, immigration policy tends to keep wages high. Let us underline this basic principle: Limitation of the supply of any grade of labor relative to all other productive factors can be expected to raise its wage rate; an increase in supply will, other things being equal, tend to depress wage rates -- Paul Samuelson, Economics , 1964 Research Evidence of immigrant effects n Cross-city studies (David Card) Cities with higher % immigrant have higher % of HS dropouts In cities with high % immigrant, there is not a larger wage gap between low-skill and high-skill native workers Could be influenced by the fact that immigrants move to places where there are higher wages for low-skill workers Counter-argument: Evidence is that immigrants settle in country-specific enclaves (so are not responsive to wages) % Immigrants % HS Dropouts Los Angeles 48 24 New York 44 17 Philadelphia 11 11 Detroit 11 12 Research Evidence of immigrant effects n Difference-in-differences study Observe the difference in wages in one city from an influx...
View Full Document

Page1 / 40

lecture4_Sept14_slides - Income, Poverty, and Health...

This preview shows document pages 1 - 15. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online