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Migration and Entrepreneurship in Mexico

Author

Listed:
  • Daniel Yi Xu

    (New York University and NBER)

  • Kevin Thom

    (New York University)

Abstract

We hope to make a novel contribution to the literature by developing a model of an individual's migration and entrepreneurship decisions over the course of the life-cycle which captures all three explanations identified above. Using data from the MMP, we will estimate the parameters of this structural model. Such structural parameter estimates will allow us to perform interesting counter-factual policy experiments, such as assessing the consequences of changes in US migration policy or Mexican entrepreneurship policy on the behavior of Mexican workers. Understanding the relative strengths of the three mechanisms is crucial for shaping a policy response to poverty. If mechanisms (1) and (2) above are dominant, then policies that increase the ease of migration will also stimulate greater entrepreneurship in Mexico. However, if mechanism (3) dominates, then migration and entrepreneurship may be alternate pathways to the alleviation of poverty. In this case, policymakers must be careful that their proposals are promoting the most expedient pathway. Of course, all three of these mechanisms may be operative, and the optimal policy response will depend on their relative strengths.

Suggested Citation

  • Daniel Yi Xu & Kevin Thom, 2010. "Migration and Entrepreneurship in Mexico," 2010 Meeting Papers 958, Society for Economic Dynamics.
  • Handle: RePEc:red:sed010:958
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    References listed on IDEAS

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    1. Schmitz, James A, Jr, 1989. "Imitation, Entrepreneurship, and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 97(3), pages 721-739, June.
    2. Banerjee, Abhijit V & Newman, Andrew F, 1993. "Occupational Choice and the Process of Development," Journal of Political Economy, University of Chicago Press, vol. 101(2), pages 274-298, April.
    3. Gordon H. Hanson, 2006. "Illegal Migration from Mexico to the United States," Journal of Economic Literature, American Economic Association, vol. 44(4), pages 869-924, December.
    4. Alice Mesnard, 2004. "Temporary migration and capital market imperfections," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 242-262, April.
    5. Dustmann, Christian & Kirchkamp, Oliver, 2002. "The optimal migration duration and activity choice after re-migration," Journal of Development Economics, Elsevier, vol. 67(2), pages 351-372, April.
    6. Woodruff, Christopher & Zenteno, Rene, 2007. "Migration networks and microenterprises in Mexico," Journal of Development Economics, Elsevier, vol. 82(2), pages 509-528, March.
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    Cited by:

    1. Alain Kikandi Kiuma & Christian Kamala Kaghoma & Joelle Mukenyi Kalala & Allegra Kabamba Mbuyi, 2015. "Mobilité interne et entrepreneuriat des jeunes en République démocratique du Congo," Working Papers PMMA 2015-07, PEP-PMMA.

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