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Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis

Joan Monras ()

No 2015-04, Sciences Po publications from Sciences Po

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: International and internal migration; local shocks; local labor demand elasticity. (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab and nep-mig
Date: 2015-03
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Related works:
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2018) Downloads
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015) Downloads
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015) Downloads
Working Paper: Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis (2015) Downloads
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