Immigration and Labor Market Equilibrium Consider two distinct labor markets in two provinces, Gaziantep and Trabzon. Initially, the “native” wage ?? is the same in both provinces, with equilibrium occurring at the intersection of labor supply and demand curves in each of the provinces. Suppose that Gaziantep receives an influx of Syrian immigrants. Assume that immigrants and natives are “perfect substitutes” in production. Immigration between the two provinces is not allowed, but it is costless for the firms to move between Gaziantep and Trabzon. Describe the new equilibrium in the labor market for natives in each of the provinces using labor supply and demand curves. Explain your reasoning.
Immigration and Labor
Consider two distinct labor markets in two provinces, Gaziantep and Trabzon. Initially, the “native” wage ?? is the same in both provinces, with equilibrium occurring at the intersection of labor supply and demand
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Assume that immigrants and natives are “perfect substitutes” in production. Immigration between the two provinces is not allowed, but it is costless for the firms to move between Gaziantep and Trabzon. Describe the new equilibrium in the labor market for natives in each of the provinces using labor supply and demand curves. Explain your reasoning.
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