Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis

Joan Monras

No 8924, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: How does the US labor market absorb low-skilled immigration? I address this question using the 1995 Mexican Peso Crisis, an exogenous push factor that raised Mexican migration to the US. In the short run, high-immigration states see their low-skilled labor force increase and native low-skilled wages decrease, with an implied local labor demand elasticity of -.7. Internal relocation dissipates this shock spatially. In the long run, the only lasting consequences are for low-skilled natives who entered the labor force in high-immigration years. A simple quantitative many-region model allows me to obtain the counterfactual local wage evolution absent the immigration shock.

Keywords: local shocks; international and internal migration; local labor demand elasticity (search for similar items in EconPapers)
JEL-codes: F22 J20 J30 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2015-03
New Economics Papers: this item is included in nep-mig and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (61)

Published - published in: Journal of Political Economy, 2020, 128, 3017–3089

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https://docs.iza.org/dp8924.pdf (application/pdf)

Related works:
Journal Article: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2020)
Working Paper: Immigration and wage dynamics: Evidence from the Mexican Peso crisis (2019)
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2018)
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015)
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015)
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015)
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