Wage Shocks and North American Labor-Market Integration

Raymond E. Robertson

106 citations0/0 files storedWorld Scientific Studies in International Economics

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Migration and Labor Dynamics Global trade and economics Labor market dynamics and wage inequality

Abstract

This study uses household-level data from the United States and Mexico to examine labor-market integration. I consider how the effects of shocks and rates of convergence to an equilibrium differential are affected by borders, geography, and demographics. I find that even though a large wage differential exists between them, the labor markets of the United States and Mexico are closely integrated. Mexico's border region is more integrated with the United States than is the Mexican interior. Evidence of integration precedes the North American Free Trade Agreement (NAFTA) and may be largely the result of migration. (JEL F15, F20, J61)

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2019American Economic Review 1995National Borders Matter: Canada-U.S. Regional Trade Patterns.1989The Impact of the Mariel Boatlift on the Miami Labor Market 1997Foreign direct investment and relative wages: Evidence from Mexico's maquiladoras 1985Panel data from time series of cross-sections 1995How Wide is the Border?1991Immigration, Trade, and the Labor Market 1985A Profitable Approach to Labor Supply and Commodity Demands over the Life-Cycle

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