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Consider a competitive economy with two sectors, services and manufacturing, and assume that labor can move freely between the sectors. The (marginal) productivity of workers

Consider a competitive economy with two sectors, services and manufacturing, and assume that labor can move freely between the sectors. The (marginal) productivity of workers in the manufacturing sector rises over time due to technological progress but that of workers in the services sector does not. Show that, as a result, the price of services rises relative to that of manufactured goods.

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