Basic principles Quote by Paul Samuelson
“By keeping labor supply down, immigration policy tends to keep wages high. Let us underline this basic principle: Limitation of the supply of any grade of labor relative to all other productive factors can be expected to raise its wage rate; and increase in supply will, other things being equal, tend to depress wage rates.”
About This Quote
Source Book: Economics, 4th Edition, Paul Samuelson, 1998
Limiting the number of workers in a sector raises wages; increasing workers lowers wages if other factors stay the same.
In simple terms: Fewer workers → higher pay; more workers → lower pay.
Consider labor supply when evaluating wage trends.
Themes
Mood
Type
When to use this quote
- policy debates
- business hiring
- career planning
- government regulation
Key Concepts
Questions to Reflect On
- How does technology affect labor demand?
- What other factors influence wages?
Assumes other factors remain constant, which rarely holds true.