Describe the short-run effect of a hypothetical inflow of low-skilled foreign workers on the labor market of Miami.
a) Suppose there are two types of workers currently in Miami, high-skilled and lowskilled. What would be predicted to happen to the labor market equilibrium outcomes for each of these groups of workers?
b) Consider the paper by David Card “The Impact of the Mariel Boatlift on the Miami Labor Market”.
i) What are the data and methods used in the paper to estimate the impact of immigration on earnings in Miami?
ii) What is the estimated effect of immigration on local wages? Is this in line with the theory? Why or why not.