Consider a two-country model of immigration where one country has a near-zero labour demand curve. Suppose half of the combined labour force is in each country. Assume the other country has a higher value-of-marginal-product of labour schedule for every level of labour input. Label the following diagram showing the wages in each country (1 mark) Now interpret the two countries as a single economy with the country with the high value-of- marginal-product of labour being the cohort of men in the workforce and the other country' being the cohort of women in 'home production (running a household) in the same economy. Comment on the labour movement and do a standard welfare analysis of the resultant move. (2 marks) 2 Now suppose that the two countries represent a conquering-and-then-colonizing (European) nation and a country without Western technology (and a low value-of-marginal-product curve as a result). Assume that conquest leads to the establishment of an organized labour market, and more efficient (from a Western capitalist point of view) economy, so that the value-of-marginal product schedule in the colonized country rises. It rises so high that workers want to leave the conquering-and-then-colonizing country and go to the colonized country. Do a standard welfare analysis. (2 marks). Start the welfare analysis before conquest and before the value-of-marginal product curve rises, and compare with the situation after it rises and workers reallocate from the colonizing country. Post conquest value-of-marginal-product Explain why the area under the labour demand curve is a measure of country-wide social welfare in mainstream economic analysis. Comment on the ethical appropriateness of this. (1 mark)