TY - JOUR
T1 - Migration, trade, and foreign direct investment in Mexico
AU - Aroca, Patricio
AU - Maloney, William F.
N1 - Funding Information:
Patricio Aroca is a professor and director of the Institute for Applied Regional Economy (IDEAR), at the Universidad Católica del Norte, Antofagasta, Chile; his email address isparoca@ucn.cl.William F.Maloney is lead economist in the Office of the Chief Economist for Latin America at the World Bank; his email address is wmaloney@worldbank.org. The research for this article was financed by the regional studies program of the Office of the Chief Economist for Latin America at the World Bank. The authors thank Jaime de Melo, Gordon Hanson, and Raymond Robertson for insightful comments and Gabriel Montes Rojas and Lucas Siga for expert research assistance.
PY - 2005
Y1 - 2005
N2 - Part of the rationale for the North American Free Trade Agreement was that it would increase trade and foreign direct investment (FDI) flows, creating jobs and reducing migration to the United States. Since poor data on illegal migration to the United States make direct measurement difficult, data on migration within Mexico, where census data permit careful analysis, are used instead to evaluate the mechanism behind predictions on migration to the United States. Specifications are provided for migration within Mexico, incorporating measures of cost of living, amenities, and networks. Contrary to much of the literature, labor market variables enter very significantly and as predicted once possible credit constraint effects are controlled for. Greater exposure to FDI and trade deters outmigration, with the effects working partly through the labor market. Finally, some tentative inferences are presented about the impact of increased FDI on Mexico-U.S. migration. On average, a doubling of FDI inflows leads to a 1.5-2 percent drop in migration.
AB - Part of the rationale for the North American Free Trade Agreement was that it would increase trade and foreign direct investment (FDI) flows, creating jobs and reducing migration to the United States. Since poor data on illegal migration to the United States make direct measurement difficult, data on migration within Mexico, where census data permit careful analysis, are used instead to evaluate the mechanism behind predictions on migration to the United States. Specifications are provided for migration within Mexico, incorporating measures of cost of living, amenities, and networks. Contrary to much of the literature, labor market variables enter very significantly and as predicted once possible credit constraint effects are controlled for. Greater exposure to FDI and trade deters outmigration, with the effects working partly through the labor market. Finally, some tentative inferences are presented about the impact of increased FDI on Mexico-U.S. migration. On average, a doubling of FDI inflows leads to a 1.5-2 percent drop in migration.
UR - http://www.scopus.com/inward/record.url?scp=31344450134&partnerID=8YFLogxK
U2 - 10.1093/wber/lhi017
DO - 10.1093/wber/lhi017
M3 - Article
AN - SCOPUS:31344450134
SN - 0258-6770
VL - 19
SP - 449
EP - 472
JO - World Bank Economic Review
JF - World Bank Economic Review
IS - 3
ER -