Suppose that until recently, U.S. firms that produce digital apps had been utilizing only the labor of qualified U.S. workers at a wage rate of $\backslash (35$ per hour. Now, however, these firms have begun engaging in labor outsourcing to Russia, where qualified workers are available at a dollar wage rate of $\backslash )15$ per hour. Evaluate the effects of this new U.S. app-labor outsourcing initiative on U.S. and Russian employment levels and wages.

With supply of labor remaining same, this leftward shift of supply curve will bring a fall in equilibrium level of employmentyet as wage rate inus. With supply of labor remaining same, this rightward shift of supply curve will bringan increase in equilibrium level of employmentstill as wage rate in Russia.

It has beengiven that U.S. firms are engagingaborning outsourcing to Russia for producing digital apps. This decrease in demand for U.S. labor will shift the demand curve for labor inu. s. leftwards.

Hence, if U.S. firms engageparturient outsourcing to Russia for producing digital apps then both level of employment and wage rate declines inu. s., if U.S. firms engageparturient outsourcing to Russia for producing digital apps then both level of employment and wage rate rises in Russia.

Onthe opposite hand, as U.S. firms are using qualified Russian laborto supply digital apps, demand for Russian labor will increase. This increase in demand for Russian labor will shift the demand curve for labor in Russia rightwards.