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Assume that Mexican migrants to the United States come to Amherst to work as dish washers in restaurants, while those born in the United States work either as dish washers or cooks and that while some prefer one occupation and others might prefer the other, they will go from one occupation to the other depending on the relative wage. Also assume that restaurants need both cooks and dish washers; and that the number of restaurants increases when restaurant labor (cooks and dish washers) is cheaper.
Use a standard labor supply and demand graph to show the effect on wages and employment for Mexican migrants and native-born workers of an increase in migration. Is immigration good or bad for native-born American workers? Is it good or bad for people looking to eat in restaurants?
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