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CAS EC 102 (215)
Lecture 3

PM Lecture 3 Jobs & Pay

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Department
Economics
Course
CAS EC 102
Professor
Jay Zagorsky
Semester
Spring

Description
PM Lecture #3: Jobs & Pay Saturday, March 22, 2014 1:45 PM Joseph Alois Schumpeter - "Capitalism, Socialism and Democracy"explains how jobs are destroyed when new ideas create new industries ○ Waves of change destroysome jobs and create new ones at the same time Immigration - Three ways to come legally ○ Family reunification (66$%total)  Unmarried children of US citizens and their children  Spouses and unmarried children of alien residents  Married children of US citizens and their spouses and children  Siblings of US citizens over the age of 21 and their spouses and children  Parents of either ○ Refugees and asylum seekers (16%)  Refugee: Typically someonefleeing from war  Asylum: Typically someonewho is persecuted by gov't or society  In 2012,three big refugee groups came to the US: Burma, Iraq and Bhutan ○ Employmentbased (< 13%)  Priority workerssuch as nurses  Professionalswith advanced degrees or aliens of exceptional ability  Skilled workers, professionals and unskilled workers  Employmentcreation such as investors - Illegal immigrants ○ In 2012,located over 640 people, most of were from Mexico and others were from Guatemala, Honduras and El Salvador ○ Latest gov't estimateis 11.5 million of which 6.8 million were Mexicans  Primarily a problem in California (2.8 million) and Texas (1.8 million) Benefits of Migration - Higher wages - More opportunity for advancement - Lower taxes - Better opportunities for children - Better healthcare - Better education - Lower chance of violenceand other crimes - Religious, sexual and political freedoms Costs of Migration - Travel costs - Border crossing costs - Resettlementcosts - Opportunity costs - Non-economiccosts - If NPV of home earnings is less than (NPV new earnings - Migration costs,) then it is efficient to migrate Low Skill Workers - Increase in number of workersshifts the supply, which makes the wage lower High Skill Workers - Brain Drain: Developing countries often lose large amounts of high skill talent to developed countries - High skilled workers shifts the supply curve, but also shifts the labor demand curve, making the new wage higher new wage higher Krugman's Summation of Impact - New benefits to the overall US economyfrom immigration are small ○ Immigration since 1980has raised total incomeof Americans by fraction
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