An increase in the demand for workers producing computers for export versus producing agricultural products that can be imported more cheaply from abroad is an example of how increasing wage inequality can result from:
A)the diminishing marginal product of labor.
B)the diminishing marginal product of capital.
C)increasing reservation prices.
D)globalization.

Question

Quizplus · Accepted Answer

Globalization puts downward wage pressure on industries where foreign competition is strong and upward wage pressure on industries where foreign competition is weak. This phenomenon often increases wage inequality.

An Increase in the Demand for Workers Producing Computers for Export