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Title: A Study of the U.S.-Mexico Border Earnings Penalty between 2000 and 2005
Citation Type: Working Paper
Publication Year: 2007
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Abstract: Several studies have identified a substantial border penalty on the earnings of individuals who reside in areas close to the U.S. - Mexico southern border. This paper uses IPUMS data based on the 2000 decennial census and the 2005 American Community Survey (ACS) 2005 samples to analyze whether this border penalty changed during the early 2000s. We first document that a border/interior earnings gap exists for the three groups of workers, despite higher average education levels within the same ethnic group along the border. Morerover, while the border earnings penalty is particularly pronounced among Mexican immigrants (-0.128), Mexican immigrants and non-Hispanic whites along the border experienced an earnings improvement between 2000 and 2005 compared to their counterparts in the rest of the U.S. (of approximately 4.4% for Mexican immigrants and 2.7% for non-Hispanic whites). Studying the manufacturing, construction and trade sectors in more detail, we find that the U.S. born Mexican-Americans are associated with a substantially higher border penalty if working in any of these sectors. The more stable border penalty premiums for Mexican immigrants (with the exception of construction (-0.213)), suggest a high degree of adaptation to the changing business cycles in the early 2000s. As a whole, our findings are consistent with at least two explanations: i) the more mobile Mexican immigrant population might be responding faster to changes in the U.S. business cycles; and ii) Mexican immigrants appear to be gaining ground versus Mexican-Americans in the job pool.
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Authors: Davila, Alberto; Mora, Marie T.; Mollick, Andre V.
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Institution: Department of Economics and Finance: College of Business Administration University of TexasPan American
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Data Collections: IPUMS USA
Topics: Education, Labor Force and Occupational Structure, Migration and Immigration, Race and Ethnicity
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