As workers migrate from low-wage Mexico to high-wage United States, wages tend to rise in Mexico and fall in the United States.

Question

Quizplus · Accepted Answer

This is a basic principle of supply and demand in labor markets. As the supply of labor decreases in Mexico, wages tend to rise as employers compete for the remaining available workers. Conversely, as the supply of labor increases in the United States, wages tend to fall as there are more workers available than there are jobs. This can lead to a convergence of wages between the two countries over time.

As Workers Migrate from Low-Wage Mexico to High-Wage United States