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The Effects of North American Free Trade Agreement and United States Farm Policies on Illegal Immigration and Agricultural Trade

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  • Luckstead, Jeff
  • Devadoss, Stephen
  • Rodriguez, Abelardo

Abstract

We analyze the effects of the North American Free Trade Agreement (NAFTA) and United States farm subsidies on U.S.-Mexican illegal immigration and agricultural trade. The theoretical analysis develops an integrated trade-migration model and shows that NAFTA and U.S. subsidies exacerbate the illegal labor flow and increase U.S. exports. The theoretical analysis is empirically implemented by simultaneous estimation and simulation analysis. The analysis shows that NAFTA increased the number of undocumented workers to U.S. agriculture and U.S. farm exports to Mexico by an average of 1573 and $6.82 billion, respectively. U.S. farm subsidy reduction decreases unauthorized entry marginally and U.S. farm exports by an average of $3.2 billion.

Suggested Citation

  • Luckstead, Jeff & Devadoss, Stephen & Rodriguez, Abelardo, 2012. "The Effects of North American Free Trade Agreement and United States Farm Policies on Illegal Immigration and Agricultural Trade," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 44(1), pages 1-19, February.
    • Handle: RePEc:cup:jagaec:v:44:y:2012:i:01:p:1-19_00
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    Cited by:

    1. Grace Melo & Gregory Colson & Octavio A. Ramirez, 2014. "Hispanic American Opinions toward Immigration and Immigration Policy Reform Proposals," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 36(4), pages 604-622.
    2. Nagler, Amy M. & Menkhaus, Dale J. & Bastian, Christopher T. & Ehmke, Mariah D. & Coatney, Kalyn T., 2013. "Subsidy Incidence in Factor Markets: An Experimental Approach," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 45(1), pages 17-33, February.
    3. Devadoss, Stephen & Luckstead, Jeff, 2017. "Immigration Policies and Farm Labor," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258435, Agricultural and Applied Economics Association.

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