Reference no: EM132503290

There is evidence that other things equal a 10% increase in the number of workers having a particular skill level leads to about a 4% decline in wages for workers with that skill level. In addition, to this 10 to 4 ratio appears to hold true whether the increase in labor supply is caused by domestic changes in labor supply or by influx of foreign immigrants. Suppose that 42,000 computer programmers work in Silicon Valley. If the number of computer programmers in Silicon Valley increases by 6,300 because of a change in the US immigration laws, by how many percentage points would you expect the wage of computer programmers to fall in Silicon Valley? Suppose that 8000 full-time cooks work in restaurants in the Denver area. If Denver becomes popular both with US citizens and with foreigners such that 800 full-time cooks move to Denver from other parts of the United States while 560 full-time cooks move to Denver from other countries, by how much would you expect the wages of full-time cook stuff all in Denver?