Immigration and Wage Dynamics: Evidence from the Mexican Peso Crisis

By Joan Monras. Journal of Political Economy, 2020

140 citations recorded by the source corpus.

How does the US labor market absorb low-skilled immigration? In the short run, high-immigration locations see their low-skilled labor force increase, native low-skilled wages decrease, and the relative price of rentals increase. Internal relocation dissipates this shock spatially. In the long run, the only lasting consequences are (a) worse labor market conditions for low-skilled natives who entered the labor force in high-immigration years, and (b) lower housing prices in high-immigrant locations, when immigrant workers disproportionately enter the construction sector and lower construction costs. I use a quantitative dynamic spatial equilibrium many-region model to obtain the policy-relevant counterfactuals.

Subfields: Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/b0425c5cbf04e5a182dd6418205f586cf69eeb9a

Citations in the corpus

• Shift-Share Instruments and the Impact of Immigration (2018, unknown): “Recent evidence from the migration literature similarly points to prolonged adjustment periods (e.g. Monras 2015, Borjas 2015, Amior and Manning 2017, Braun and Weber 2016, Edo 2017), and it has been observed that local labor markets are slow to adjust even long after other types of shocks (e.g.…”
• Gifts of the Immigrants, Woes of the Natives: Lessons from the Age of Mass Migration (2019, unknown): “…effect of immigration on natives’ employment and wages.1 While this idea is consistent with findings in Borjas (2003), Dustmann et al. (2017), and Monras (2018) among others, it is in contrast with results in Card (2001, 2005), Foged and Peri (2016), and Ottaviano and Peri (2012) who document…”