Working Paper: NBER ID: w11412
Authors: Gordon H. Hanson
Abstract: In this paper, I examine changes in labor supply and earnings across regions of Mexico during the 1990s. I focus the analysis on individuals born in states with either high-exposure or low-exposure to emigration, as measured by historical data on state migration to the United States. During the 1990s, rates of external migration and interval migration were higher among individuals born in high-migration states. Consistent with positive selection of emigrants in terms of observable skill, emigration rates appear to be highest among individuals with earnings in the top half of the wage distribution. Controlling for regional differences in observable characteristics and for initial regional differences in earnings, the distribution of male earnings in high-migration states shifted to the right relative to low-migration states. Over the decade, average hourly earnings in high-migration states rose relative to low-migration states by 6-9%.
Keywords: emigration; labor supply; earnings; Mexico; migration networks
JEL Codes: F22; J61
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| historical migration patterns (F22) | current migration opportunities (J61) |
| negative labor supply shocks (J20) | larger emigration incentives in states with a longer history of migration (J61) |
| emigration rates (J11) | wage increases (J38) |
| outmigration of labor (J61) | upward pressure on wages in Mexico (F16) |