Economic Impact Of Immigration Research Assignment

ECONOMIC EFFECTS OF IMMIGRATION(Kynesian Theory Approach)NameInstitutional AffilaitionDate
Economic Effects of Immigration
There are three main ideas that come out from the Keynesian Economic Approach that can help us to evaluate the effects that immigration has on the economy of a country. The first principle is that the aggregate demand in a country is as a result of the economic policies and decisions that are made not only the government but also the private sector. Decisions that are made by the private sector can lead to numerous economic outcomes such as the reduction in the amount that the consumers spend in economic stagnation. The government therefore has to come with active policies to avoid more effects. Keynesian Approach supports policies that are mainly formulated by the private sector and regulated partly by the government.[Christian, Dustmann, Fasani Francesco, and Speciale Biagio. 2016. "Illegal migration and consumption behaviour of immigrant households,]
The second principle is that prices, which in this case would be viewed as the wages which the immigrants receive, show a very slow response to the changes that occur in supply and demand. This will in turn result to various shortages that will occur to the main factors of production that is capital and labor.
The third principle is that a change in the aggregate demand expected or not expected can have short term effects on the real output and the employment opportunities and not necessarily on prices of goods. This means that if fluctuations occur in any of the main aspects of spending (consumption, investment and government expenditures) there will be a change in the output. When there is an increase in the government expenses, the other components will remain constant.
The Keynesian Economic Theory seems to be very critical of the Classical Economics Theory on the issue of international migration. The Keynesian Theory, provides an argument that the supply of labor depends on two main items; the nominal wage and the real wage of the laborers. This view arises as a result of the different views of both theories on the role that money plays in the economy. Keynesian theory shows that money has two main roles that it plays in an economy. It is used as a medium of exchange and a means of saving. The neo-classical theories argues that money is only used as a medium of exchange. This makes the immigrants to be attracted to a regions that provide their workers with high nominal wages. In Keynesian approach, migration is an equilibrium that can be used to bridge the differences between nominal wages and the real wages even though the theory shows that international migration gets rid of the unemployment differences more rather than the wage differences.
Immigration is a big issue in most countries. Immigrants compose around 12%-15% of the total workforce in any particular country. The economic impact of immigration depends on the skills that the immigrants have. Different types of immigrants can have
Various effects on the economy of a country. Most of the business and other public service institutions make use of the skills and hard work of the immigrants. It should not be used to justify the increased rates of immigration in the world that even exceed...