How might outsourcing affect wages


Some firms in the United States now outsource computer-programming tasks. They hire programmers in countries such as India to do work formerly done by programmers living in the United States.

Supporters of outsourcing argue (correctly) that as long as the government follows a macroeconomic policy that keeps the economy at full employment, outsourcing will not lead to higher unemployment among computer programmers living in the United States.

Why might programmers living in the United States still be opposed to outsourcing? Think about the supply and demand for programmers in the United States. How might outsourcing affect wages?

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Microeconomics: How might outsourcing affect wages
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