The impact of return migration on employment and wages in Mexican cities

Dario Diodato, Ricardo Hausmann and Frank Neffke

Journal of Urban Economics, 2023, vol. 135, issue C

Abstract: How does return migration from the US to Mexico affect local workers? Return migrants increase the local labor supply, potentially hurting local workers. However, having been exposed to a more advanced U.S. economy, they may also carry human capital that benefits non-migrants. Using an instrument based on involuntary return migration, we find that, whereas workers who share returnees’ occupations experience a fall in wages, workers in other occupations see their wages rise. These effects are, however, transitory and restricted to the city-industry receiving the returnees. In contrast, returnees permanently alter a city’s long-run industrial composition, by raising employment levels in the local industries that hire them.

Keywords: Return migration; Skills; Employment; Wages; Mexico; United States (search for similar items in EconPapers)
JEL-codes: F22 J21 J24 J61 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:juecon:v:135:y:2023:i:c:s0094119023000268

DOI: 10.1016/j.jue.2023.103557

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