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International Import Competition and the Decision to Migrate: Evidence from Mexico

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  • Majlesi, Kaveh

    (Monash University)

  • Narciso, Gaia

    (Trinity College Dublin)

Abstract

We analyze the effects of the increase in China's import competition on Mexican domestic and international migration. We exploit the variation in exposure to competition from China, following its accession to the WTO in 2001, across Mexican municipalities and estimate the effect of international competition on the individual decision to migrate. Controlling for individual and municipality features, we find that individuals living in municipalities more exposed to Chinese import competition are more likely to migrate to other municipalities within Mexico, while a negative effect is found on the decision to migrate to the US. In particular, we find that Chinese import competition reduces migrants' negative self- selection: the rising international competition lowers the likelihood of low-educated, low-income people to migrate to the US, by making them more financially constrained. We do not find any evidence that changes in demand for Mexican workers in the US drive our results.

Suggested Citation

  • Majlesi, Kaveh & Narciso, Gaia, 2018. "International Import Competition and the Decision to Migrate: Evidence from Mexico," IZA Discussion Papers 11346, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp11346
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    Cited by:

    1. Rutledge, Zachariah & Mayorga, Joaquin, 2022. "Chinese Trade Competition and Mexican Farm Labor Supply," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322515, Agricultural and Applied Economics Association.
    2. Narciso, Gaia, 2020. "Crop prices and the individual decision to migrate," Food Policy, Elsevier, vol. 91(C).
    3. Fernández Guerrico, Sofía, 2021. "The effects of trade-induced worker displacement on health and mortality in Mexico," Journal of Health Economics, Elsevier, vol. 80(C).
    4. Gaia Narciso, 2018. "Crop prices and migration in Vietnam," WIDER Working Paper Series wp-2018-142, World Institute for Development Economic Research (UNU-WIDER).
    5. Rodriguez Castelan,Carlos & Vazquez,Emmanuel Jose & Winkler-Seales,Hernan Jorge, 2020. "Tracing the Local Impacts of Exports on Poverty and Inequality in Mexico," Policy Research Working Paper Series 9459, The World Bank.
    6. Sónia Cabral & Pedro S. Martins & João Pereira dos Santos & Mariana Tavares, 2021. "Collateral Damage? Labour Market Effects of Competing with China—at Home and Abroad," Economica, London School of Economics and Political Science, vol. 88(350), pages 570-600, April.
    7. Gaia Narciso, 2018. "Crop prices and migration in Vietnam," WIDER Working Paper Series 142, World Institute for Development Economic Research (UNU-WIDER).
    8. Melissa Dell & Benjamin Feigenberg & Kensuke Teshima, 2019. "The Violent Consequences of Trade-Induced Worker Displacement in Mexico," American Economic Review: Insights, American Economic Association, vol. 1(1), pages 43-58, June.
    9. Raymond Robertson & Timothy J. Halliday & Sindhu Vasireddy, 2020. "Labour market adjustment to third‐party competition: Evidence from Mexico," The World Economy, Wiley Blackwell, vol. 43(7), pages 1977-2006, July.
    10. Mahé, Clotilde, 2020. "Publicly provided healthcare and migration," Economics & Human Biology, Elsevier, vol. 39(C).
    11. Sofía Fernández Guerrico, 2023. "Trade Shocks, Population Growth, and Migration," ULB Institutional Repository 2013/357236, ULB -- Universite Libre de Bruxelles.
    12. Gröger, André, 2021. "Easy come, easy go? Economic shocks, labor migration and the family left behind," Journal of International Economics, Elsevier, vol. 128(C).
    13. Gray, Rowena & Narciso, Gaia & Tortorici, Gaspare, 2019. "Globalization, agricultural markets and mass migration: Italy, 1881–1912," Explorations in Economic History, Elsevier, vol. 74(C).
    14. Narciso, Gaia, 2020. "Reprint of: Crop prices and the individual decision to migrate," Food Policy, Elsevier, vol. 94(C).
    15. Heckl, Pia, 2024. "Import Shocks and Gendered Labor Market Responses: Evidence from Mexico," Labour Economics, Elsevier, vol. 88(C).
    16. Rowena Gray & Gaia Narciso & Gaspare Tortorici, 2017. "Globalization, Agricultural Markets and Mass Migration," RF Berlin - CReAM Discussion Paper Series 1713, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    17. Akira Sasahara, 2022. "The Empirics of the China Trade Shock: A Summary of Estimation Methods and A Literature Review," Keio-IES Discussion Paper Series 2022-008, Institute for Economics Studies, Keio University.
    18. Carlos Rodríguez-Castelán & Emmanuel Vazquez & Hernán Winkler, 2020. "Tracing the Local Impacts of Exports on Poverty and Inequality: The Case of Mexico," CEDLAS, Working Papers 0269, CEDLAS, Universidad Nacional de La Plata.
    19. Dongmei Guo & Die Hu & Weizeng Sun, 2023. "Effect of goods market segmentation on labor mobility: Evidence from China," Review of Development Economics, Wiley Blackwell, vol. 27(1), pages 423-449, February.

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    More about this item

    Keywords

    international migration; domestic migration; import competition; negative self-selection;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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