Read article and write answers questions Coursework

Read article and write answers questions - Coursework Example The wage increase will be larger in the long run. Absorption of foreign labour into the work force is likely to cause a decline in average wages in the short run because most of the new immigrants laborers will be paid less than the domestic workers, however, this decline will only be temporary. Wages would rise greatly in the long run because businesses will begin investing to take advantage of the increased labour force. Increased immigration results in an influx of new laborers with a wide range of skills thus promoting specialization. Highly skilled immigrant laborers would generate more productive innovations thus expanding the productivity. Highly skilled and unskilled American workers are likely to gain the least from immigration because they will face stiff competition from their respective new immigrants. In addition, their relative income would decline by 0.3% because they are easily replaced by new