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Title: Effect of Emigration on Wages in Developing Countries: Evidence from Mexico
Citation Type: Miscellaneous
Publication Year: 2003
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Abstract: A vast theoretical and empirical literature considers the labor-market impact of immigration. In contrast, the literature on the labor-market impact of emigration or outflow of workers is almost exclusively theoretical. This paper is the first econometric study of the effect of emigration on national wages. I examine empirically the effect of Mexican migration to the United States on wages in Mexico using data from the Mexican and the US census from 1960-1990. The main result in the paper is that emigration has a strong and positive effect on Mexican wages. A 10% decrease in the supply of natives owing to emigration increases wages in Mexico by 3.3 7.6%. The increase in wages is the highest for the higher wage earners (those with 12-15 years of schooling). Simple welfare measures based on a partial equilibrium framework suggest that emigration loss to Mexico as a whole is less than 0.1% of GDP. However, there is a significant distributional impact. The gain to existing workers and loss to capital owners is in the range of 1.0 2.4 % of GDP.
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Authors: Mishra, Prachi
Publisher: Columbia University
Data Collections: IPUMS USA
Topics: Labor Force and Occupational Structure, Migration and Immigration
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