Working Paper: NBER ID: w11552
Authors: David Card; Ethan G. Lewis
Abstract: Mexican immigrants were historically clustered in a few cities, mainly in California and Texas. During the past 15 years, however, arrivals from Mexico established sizeable immigrant communities in many "new" cities. We explore the causes and consequences of the widening geographic diffusion of Mexican immigrants. A combination of demand-pull and supply push factors explains most of the inter-city variation in inflows of Mexican immigrants over the 1990s, and also illuminates the most important trend in the destination choices of new Mexican immigrants - the move away from Los Angeles. Mexican inflows raise the relative supply of low-education labor in a city, leading to the question of how cities adapt to these shifts. One mechanism, suggested by the Hecksher Olin model, is shifting industry composition. We find limited evidence of this mechanism: most of the increases in the relative supply of low-education labor are absorbed by changes in skill intensity within narrowly defined industries. Such adjustments could be readily explained if Mexican immigrant inflows had large effects on the relative wage structures of different cities. As has been found in previous studies of the local impacts of immigration, however, our analysis suggests that relative wage adjustments are small.
Keywords: Mexican immigration; Labor markets; Geographic diffusion; Supply push factors; Demand pull factors
JEL Codes: J61
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Increase in relative supply of low-education labor in cities (J69) | Shifts in the skill mix of local populations (J69) |
| Earlier immigrant cohorts (J11) | Estimate of inflows of Mexican immigrants on low-education labor supply (J69) |
| Inflows of Mexican immigrants (F24) | Minimal relative wage changes (J38) |
| Mexican immigrants (K37) | Substitutes for high school graduates (I21) |
| Inflows of Mexican immigrants (F24) | Increase in relative supply of low-education labor in cities (J69) |