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Increasing the availability of any kind of labor (whether ordinary programmers, or "great" programmers) always lowers the price, and if it didn't lower the pric
by swatow 12y ago
Increasing the availability of any kind of labor (whether ordinary programmers, or "great" programmers) always lowers the price, and if it didn't lower the price, there would be no effect. The startups looking for great programmers could find them if they stole them from Google or Facebook for huge salaries.
The problem with this debate is neither side has the intellectual courage to state their side properly.
The protectionists latch on to the "indentured servitude" issue even though employers would want H-1Bs whether or not they could hold being fired and having to return home over the employees head (and I personally have never seen this happen, I assume it only occurs with the lower tier workers hired by contracting companies, if at all). Protectionists pretend that this is the mechanism through which H-1B's lower wages, even though the real effect is via increasing the supply.
Similarly people like pg say that the issue isn't wages, even though, as I mentioned, the issue can always be expressed in the supply curve of labor, and equilibrium wages.
- mvc 12y ago> Increasing the availability of any kind of labor (whether ordinary programmers, or "great" programmers) always lowers the price, and if it didn't lower the price, there would be no effect. It turns out that high-wage employees (e.g. software developers) actually benefit from high immigration because of the resulting increase in capital inflows. http://www.nber.org/papers/w12497 http://www.nber.org/papers/w12497
- swatow 12y agoSure, my claims are actually consistent with this result. I was describing a partial equilibrium effect while the paper is describing a general equilibrium effect.
- schlumpf 12y agoThe "issue" in question is the marginal productivity of imported ICT labor. Your generalization about nominal wage effects holds only where an economy faces constant (or diminishing) returns to scale from immigration [1]. This essay argues exactly the opposite, that US government policy should compete to attract people who will increase economic returns to scale. > ...it's easy to imagine cases where a great programmer might invent things worth 100x or even 1000x an average programmer's salary. Moreover, there is evidence that even IT workers in identical, commoditized roles are sufficiently more productive in the US than than in India so as to justify an extra $75k per capita in client billings for they US-based workers [2]. PG's essay is not sufficiently described by a rudimentary labor supply curve as you claim. [1] http://www2.hawaii.edu/~noy/362texts/immigration.pdf http://www2.hawaii.edu/~noy/362texts/immigration.pdf p.156, particularly footnote 8 [2] https://www.aeaweb.org/aea/2013conference/program/retrieve.php?pdfid=459 https://www.aeaweb.org/aea/2013conference/program/retrieve.p...