Working Paper: NBER ID: w18266
Authors: David Atkin
Abstract: This paper presents empirical evidence that the growth of export manufacturing in Mexico during a period of major trade reforms, the years 1986-2000, altered the distribution of education. I use variation in the timing of factory openings across commuting zones to show that school dropout increased with local expansions in export manufacturing. The magnitudes I find suggest that for every twenty-five jobs created, one student dropped out of school at grade 9 rather than continuing through to grade 12. These effects are driven by less-skilled export-manufacturing jobs which raised the opportunity cost of schooling for students at the margin.
Keywords: Export Manufacturing; Education; Opportunity Cost; Mexico
JEL Codes: F16; J24; O12; O14; O19
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| local demand shocks (R22) | omitted variable bias (C20) |
| previous schooling deviations (I21) | omitted variable bias (C20) |
| export job growth (J68) | school dropout rates (I21) |
| factory openings (L69) | school dropout rates (I21) |
| export job growth (J68) | schooling decisions (I21) |
| age 16 at factory openings (N62) | school dropout rates (I21) |