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Immigration and Economics

In: Other Topics

Submitted By britnay2
Words 1286
Pages 6
Stagnate Wages & Immigration: An Explanation & Solutions

There have been ongoing debates about how immigrants are stealing jobs from native-born Americans. However way it is projected in politics there is no doubt that the influx of people immigrating to the U.S has been a major source of economic growth. Looking at immigration from an economic standpoint we will see that there are some who benefit and some who are left at a disadvantage from the flood of immigrants over the years. It’s a complicated issue as to why wages in America have not seen meaningful increases even as the economy has seen evidence of improvement. The questions remains on weather policies like increasing the minimum wage or educating our expanding population and letting the wages adjust naturally are good choices to increase stagnate wages. By looking at the supply and demand labor model, we will see that immigration and its tie to stagnate wages in the United States and long term or short-term steps that can be taken to resolve the issue.
Based on the basic economic model the labor supply is represented by the supply curve, and that it is upward sloping. The businesses represent the downward sloping demand curve, as they are the ones with jobs to offer. When surges of immigrants enter the labor force, it shifts the supply curve to the right along the demand curve. The demand curve does not change because workers are not able to dictate how many workers a firm will need for a particular job. The result is a greater quantity of workers but at a lower new equilibrium point on the wage axis. Based on this model, it proves that a larger pool of workers will lower wage rates. This is not good news for native-born workers. In order to have a job they must accept these lower wage rates. However, from the business’ perspective they are able to take advantage of cheap labor, increasing...

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