Trade, FDI, migration, and the place premium: Mexico and the United States
Timothy Halliday and
Additional contact information
Davide Gandolfi: Uppsala University
Review of World Economics (Weltwirtschaftliches Archiv), 2017, vol. 153, issue 1, 1-37
Abstract Large wage differences between countries (“place premiums”) are well documented. Theory suggests that factor price convergence should follow increased migration, capital flows, and commercial integration. All three have increased between the United States and Mexico over the last 25 years. This paper evaluates the degree of wage convergence between these countries during the period 1988 and 2011. We match survey and census data from Mexico and the United States to estimate the change in wage differentials for observationally identical workers over time. We find very little evidence of convergence. What evidence we do find is most likely due to factors unrelated to US–Mexico integration. While migration, trade, and FDI may reduce the US–Mexico wage differential, these effects are small when compared to the overall wage gap.
Keywords: Migration; Labor-market integration; Factor price equalization (search for similar items in EconPapers)
JEL-codes: F15 F16 J31 F22 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
http://link.springer.com/10.1007/s10290-016-0260-2 Abstract (text/html)
Access to the full text of the articles in this series is restricted.
Working Paper: Trade, FDI, Migration, and the Place Premium: Mexico and the United States (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:spr:weltar:v:153:y:2017:i:1:d:10.1007_s10290-016-0260-2
Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10290/PS2
Access Statistics for this article
Review of World Economics (Weltwirtschaftliches Archiv) is currently edited by Paul Bergin, Holger Görg, Cédric Tille and Gerald Willmann
More articles in Review of World Economics (Weltwirtschaftliches Archiv) from Springer, Institut für Weltwirtschaft (Kiel Institute for the World Economy) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla ().