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Highskilled workers and the market for low-skilled workers

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Consider two distinct labor markets: the market for highskilled workers and the market for low-skilled workers. Highskilled workers have higher wages, but in order to become a high-skilled worker, low-skilled workers must pay tuition costs. Firms are immobile. Using a supply and demand graph(s), predict the impact of government partial tuition subsidies on the wages of high-skilled and the wages of low-skilled workers. What does this do to wage inequality (and how)? Briefly comment.

Reference no: EM131706348

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