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Chapter 23 Immigration Number of Immigrants Chapter 23 Immigration Number of Immigrants

Chapter 23 Immigration Number of Immigrants - PowerPoint Presentation

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Chapter 23 Immigration Number of Immigrants - PPT Presentation

Economic immigrants Legal immigrants Migration averaged 1 million per year Quotas refugees and H1B provision Onethird of population growth Onehalf of labor force growth LO1 Number of Immigrants ID: 750142

immigrants immigration number wage immigration immigrants wage number output lo3 illegal economic employment efficiency mexico impacts wages lo1 effects

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Presentation Transcript

Slide1

Chapter 23

ImmigrationSlide2

Number of Immigrants

Economic immigrants

Legal immigrants

Migration averaged 1 million per year

Quotas, refugees, and H1-B provisionOne-third of population growthOne-half of labor force growth

LO1Slide3

Number of Immigrants

LO1Slide4

Number of Immigrants

Illegal immigrants

Estimated from Census data

2

50,000 per year on averageHigh proportion from Mexico and Central AmericaTotal of 11.1 million residing in the U.S. in 2012; 58% from Mexico

LO1Slide5

Decision to Migrate

Take advantage of superior economic opportunities

Escape political or religious oppression

Reunite with family members

LO2Slide6

Decision to Migrate

Earnings opportunities

Increase value of

human capital

Moving costsDistanceFollow beaten path Age

Other factors

LO2Slide7

Economic Effects

Personal gains

Economic benefits exceed costs

Other issues

Uncertainty and imperfect informationBackflowsSkill transferabilitySelf-selection

LO3Slide8

Impacts on Wages, Efficiency, Output

Understand economic outcomes

Assumptions

U.S. and Mexico

Labor demand greater in U.S.No long-term unemploymentLabor quality the sameMigration is legal and has no cost

Wage differentials key factor

LO3Slide9

Impacts on Wages, Efficiency, Output

Wage rates will equalize

In the U.S.:

Wage rate falls

Employment and output rise

In Mexico:Wage rate risesEmployment and output fall

LO3Slide10

Impacts on Wages, Efficiency, Output

Overall effects:

World output rises

Efficiency gains

Other effectsBrain drainsU.S. natives lose wage incomeU.S. businesses gain income

LO3Slide11

Complications and Modifications

Migration costs not zero

Remittances

redistribute income

Backflows: temporary migrationImmigrant workers as complementary resources vs. substitute resources

Expansion of capital in some industriesFull employment vs. unemploymentNegative self-selection

LO3Slide12

Fiscal Impacts

Fiscal burden > taxes paid

Wages will not equalize

Research findings are mixed

LO3Slide13

Illegal Immigration

Employment effects

Two extreme views

Fixed number of jobs in economy

Immigrant employment decreases domestic employment 1-for-1Immigrant work undesirableNo domestic workers displacedCompensating wage differential

LO4Slide14

LOSlide15

Startling Slowdown in

Illegal Immigration

Number of illegal immigrants in the U.S. tripled between 1990 and 2007

That number fell 8% in 2009 because of deceased job prospects during the recession

Illegal immigration population leveled off 2010 and 2011 at 11.1 millionFalling birthratesBetter local job opportunities

Government policiesStronger border enforcementSlide16

Optimal Immigration

Immigration can either benefit or harm a nation, depending on several factorsImmigration should be expanded until its MB = MC

The level of immigration is set through quotas, special provisions, border enforcement and immigration laws

LO5Slide17