Question: Consider a Specific Factors Model with International Labor Mobility. Suppose that there are two countries in the world, Home and Foreign, producing a single good

Consider a Specific Factors Model with International Labor Mobility. Suppose that there are two countries in the world, Home and Foreign, producing a single good with two factors of production, land and labor. Labor is the mobile factor and land is the specific factor in each country. Suppose that the producers in each country are competitive and profit-maximizing. a. Suppose that initially, borders are closed, and the MPL at Home exceeds the MPL in Foreign. What would be the relation between real wages at Home and Foreign in this scenario?

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