The 1995 north american free trade agreement provides for two-way, long-haul trucking across the u. s.-mexican border. u. s. truckers have objected, arguing that the mexican trucks don't have to meet the same environmental and safety standards as u. s. trucks. they are concerned that the combination of these lower fixed costs and lower mexican wages will result in mexican drivers taking business from them. their complaints have delayed implementation of this agreement (except for a small pilot program during the bush administration, which was ended during the obama administration). what would be the short-run and long-run effects of allowing entry of mexican drivers on market price and quantity and the number of u. s. truckers?
assume prior to the entry of mexican truckers that the trucking industry is in long-run equilibrium. if mexican truckers enter the industry, then when the market returns to long-run equilibrium, the market price will decrease the market quantity will lincreasee each individual trucker's output will increase and the number of u. s. truckers in the industry will be unchanged