Suppose that a workers skills can be summarised by the number of efficiency units of labour she owns. In deciding whether to migrate to Australia, UK workers compare their weekly potential earnings at home (w_uk) with their potential earnings in Australia (w_AUS).

The wage-skills relationship in these countries is given by:

w_uk = 400 + 0.5S and w_{AUS =} 300 + S

Where S is the number of efficiency units. Assume no migration costs.

a) Which type of workers is going to migrate to Australia? Is the immigrant flow positively or negatively selected? Solve numerically. Explain your reasoning. (don't answer this)

b) Now assume that Australia introduces a new welfare policy. The government provides a higher minimum income floor of 450 to all workers, including newly arrived workers (i.e every worker is guaranteed 450). Does this welfare programme change the selection of the immigrant flow? A verbal answer is sufficient. (10 marks)

please make sure all marks are fulfilled - it is a labour economics exam question

just answer part b please