Question 1

For workers who emigrate to the United States from a country with a less equal distribution of earnings,

Accepted Answer

A)  the largest potential gain exists for unskilled workers. 
B)  the largest potential gain exists for skilled workers. 
C)  immigrants will be positively selected with respect to skills. 
D)  immigrants will, on average, have a higher skill level than the workers who do not emigrate.

Question 2

Suppose all home values fall by $50,000, such that when a person moves, they have to take a $50,000 loss as they had borrowed up to the full value of the house. However, assume movers still have the credit to buy a new home. How will this event affect the mobility of homeowners as compared to losing $50,000 in the stock market?

Accepted Answer

A)  Mobility will the same as either loss is a sunk costs. 
B)  The loss in home value will reduce the mobility of owners more because by not moving, they can avoid facing the loss in their home's value. 
C)  The loss in home value will increase mobility because homes elsewhere are now $50,000 cheaper. 
D)  The loss in home value will increase mobility only if homes are expected to appreciate more than stocks.

Question 3

Suppose there is a large increase in immigrants from Romania into the United States. Native workers in the United States would be better off when they are

Accepted Answer

A)  Gross substitutes with Romanian workers. 
B)  Gross complements with Romanian workers. 
C)  Not affected by the "output effect" caused by the new Romanian workers. 
D)  Complements, but not gross complements, with Romanian workers.

Question 4

An increase in his or her expected career length will make a worker

Accepted Answer

A)  more likely to change jobs. 
B)  less likely to change jobs. 
C)  exactly as likely to change jobs. 
D)  either more or less likely to change jobs.

Question 5

In the past, China limited the movement of workers from rural to urban areas. When it got rid of these limits, one would expect

Accepted Answer

A)  urban wages to rise in order to attract rural workers. 
B)  rural wages to fall as workers leaving depress the rural area. 
C)  national output to rise as workers are better matched with employers. 
D)  national output to fall due to higher total mobility costs.

Question 6

The earnings of immigrants, when compared to those of similar native workers,

Accepted Answer

A)  start out above those of the native workers, but increase more slowly. 
B)  start out above those of the native workers, and increase more rapidly. 
C)  start out below those of the native workers, and increase more slowly. 
D)  start out below those of the native workers, but increase more rapidly.

Question 7

Within each age group, people with ________ are most likely to migrate.

Accepted Answer

A)  a large amount of education 
B)  a large amount of experience 
C)  young children 
D)  no current employment

Question 8

Average job tenure is lower in the United States than in most other industrialized countries. Theory predicts that this could be because

Accepted Answer

A)  the United States is less densely populated. 
B)  American workers receive higher levels of firm-specific training. 
C)  the costs of residential mobility are lower in the Unites States. 
D)  most American workers have employer-based health insurance.

Question 9

Suppose women have higher quit rates than men. Which of the following (if true) would NOT explain why? (Note: in fact, after controlling for the relevant factors, women's quit rate is the same as men)

Accepted Answer

A)  Women workers get less firm-specific training. 
B)  Women are more educated than men. 
C)  Women invest in human capital that is of use to many employers. 
D)  Married women traditionally have changed employers when their husband got promoted and move to another city.

Question 10

If skilled and unskilled labor are gross substitutes and if an influx of unskilled immigrants drives down the wages paid to unskilled workers, it will also

Accepted Answer

A)  increase the wage of skilled workers. 
B)  decrease the wage of skilled workers. 
C)  either increase or decrease the wage of skilled workers. 
D)  cause no change in the wage of skilled workers.

Question 11

As long as immigrants are paid their marginal product and pay more in taxes than they consume in government benefits, then an increase of immigrants will cause

Accepted Answer

A)  aggregate income of natives to increase. 
B)  average wages of workers to increase. 
C)  individual incomes of all workers to increase. 
D)  average wages of workers to stay the same.

Question 12

For which of these groups are the psychic costs the greatest obstacle to moving?

Accepted Answer

A)  more educated people 
B)  people moving within a community 
C)  people with children 
D)  single people

Question 13

The most important determinant of migration is

Accepted Answer

A)  education. 
B)  race. 
C)  age. 
D)  experience.

Question 14

Higher costs of changing jobs will result in all of the following EXCEPT

Accepted Answer

A)  individual firms' labor supply curves will slope upward. 
B)  some workers will stay in jobs even when they can earn more in an identical job with another firm. 
C)  firms will lose some monopsony power. 
D)  quit rates will not be perfectly responsive to changes in wages.

Question 15

The annual rate of immigration to the United States (per thousand of United States population)

Accepted Answer

A)  reached an all-time high in the early 1990s. 
B)  reached a post-World War II high in the early 1990s. 
C)  reached an all-time high in the 1930s. 
D)  has been fairly constant since World War II

Question 16

In a competitive industry, it takes a fixed ratio of one skilled worker and two unskilled workers to produce a unit of output. If the immigration of unskilled workers lowers the wage of unskilled workers, it will likely

Accepted Answer

A)  increase the demand for skilled workers due to the scale effect. 
B)  increase the demand for skilled workers due to the substitution effect. 
C)  decrease the wage but increase the employment of domestic unskilled workers. 
D)  All of the above will occur.

Question 17

An increase in the number of immigrants causes

Accepted Answer

A)  the labor demand curve to shift to the left. 
B)  the labor supply curve to shift to the left. 
C)  the labor supply curve to shift to the right. 
D)  the labor demand curve to become flatter.

Question 18

When compared to the earnings of political migrants, the earnings of economic migrants

Accepted Answer

A)  start out lower, and increase more slowly. 
B)  start out lower, but increase more quickly. 
C)  start out higher, but increase more slowly. 
D)  start out higher, and increase more quickly.

Question 19

If skilled and unskilled labor are gross complements, then an increase in immigration and a corresponding decrease in wages paid to unskilled laborers will cause

Accepted Answer

A)  an increase in the employment of skilled labor. 
B)  a decrease in the employment of skilled labor. 
C)  no change in the employment of skilled labor. 
D)  a decrease in the employment of unskilled labor.

Question 20

Health insurance and pension plans that are not portable between companies

Accepted Answer

A)  increase job mobility as more workers change jobs to find the best health and pension plans. 
B)  cause quit rates to be higher than is socially useful. 
C)  increase the willingness of the company to pay for the training of its workers. 
D)  make the economy more flexible by making job matches that best adapt to changing conditions.

Exam 10: Worker Mobility: Migration, Immigration, and Turnover