The Effect of Mexican Emigration to the US on Trade and Inward FDI in Mexico*

Michael Gove and Liliana Meza González

International Economic Journal, 2022, vol. 36, issue 2, 229-246

Abstract: Using a panel data set of the 32 Mexican states and the 10 years from 2008 and 2017, this paper estimates the potential contribution of migration to international trade and foreign direct investment (FDI). In the context of Mexico and the United States, we estimate models with a generalized propensity scores (GPS) methodology in order to account for the endogeneity of the migration decision, in addition to baseline gravity models. We find a generally positive and significant relationship between Mexico-US migration and Mexico-US imports, exports, and inward FDI from the US to Mexico. While mixed evidence is found across the various gravity estimations regarding the relationship between Mexico-US migration and inward FDI from the US to Mexico, the GPS results signal consistency across various estimations. Even when controlling for size of the state population, size of the state economy, distance from the capital city of each state to the Mexico-US border, and the fact that a state is on the Mexico-US border, basic results remain consistent. We conclude that in this context migration complements trade and inward FDI, and point to transnationalism as a central factor that leads to migration’s positive contribution.

Date: 2022
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/10168737.2022.2055107 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:intecj:v:36:y:2022:i:2:p:229-246

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RIEJ20

DOI: 10.1080/10168737.2022.2055107

Access Statistics for this article

International Economic Journal is currently edited by Jaymin Lee Editor

More articles in International Economic Journal from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().