Thursday, September 14, 2006

Immigration

The effect of immigration on wages has more or less been a mystery to most people - not unlike quantum physics. Most people have an opinion on it; few understand it. It seems, as usual, the goverment is confused. The House and the Senate recently both passed legislation relevant to illegal immigrants - HR 4437 called for the criminalization of illegals, and the corresponding Senate bill called for the road to legalize them.

There has been a lot of literature on this subject matter. The earliest analysese considered immigrant workers as perfect substitutes to domestic labor. Of course, we have come a long way from arcane homogeneity assumptions - now articulating these ideas in models with "nested" complex labor functions, etc.

Out of curiousity, before I go on, let's take a quick poll - what is your take on the effect of immigration on wages?

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