I need help with setting up and answering problem c.
c. If an unlimited flow of Mexican workers is allowed (free movement of labor across borders), at the end, wages will be equal in both countries (basically, in practice, there will be just one unified labor market). What would be this wage? How many Mexican workers will emigrate to the US? How many Mexican workers will be demanded in the US? At the end, how many workers will there be in México and the US? (Hint: Find the total labor supply and demand equations).
Given: Nd Mex = 140 - 2 W MEX and Ns Mex = 80 Therefore, W MEX = (140 - Nd Mex ) / 2 Nd US = 600 - 4 W US and Ns US =... View the full answer