Suppose that the introduction of computers increases the productivity of workers in the developed world. What you would expect wages to do?
A) Rise mainly in the developed countries.
B) Rise mainly in the developing countries.
C) Fall mainly in the developed countries.
D) Fall mainly in the developing countries.

Question

Quizplus · Accepted Answer

The increased productivity of workers in the developed world due to the introduction of computers would lead to an increase in the demand for skilled workers who can operate and maintain the computers. As a result, wages for skilled workers in the developed world would rise. In contrast, the developing countries may not have the same level of access to technology and may not be able to compete with the higher wages offered for skilled labor in the developed world. Therefore, the overall effect would be an increase in wages mainly in the developed countries.

Suppose That the Introduction of Computers Increases the Productivity of Workers