Mexico–U.S. Immigration: Effects of Wages and Border Enforcement

In this article, I study how relative wages and border enforcement affect immigration from Mexico to the U.S. To do this, I develop a discrete choice dynamic programming model where people choose from a set of locations in both the U.S. and Mexico, while accounting for the location of one’s spouse when making decisions. I estimate the model using data on individual immigration decisions from the Mexican Migration Project. Counterfactuals show that a 10% increase in Mexican wages reduces migration rates and durations, overall decreasing the number of years spent in the U.S. by about 5%. A 50% increase in enforcement reduces migration rates and increases durations of stay in the U.S., and the overall effect is a 7% decrease in the number of years spent in the U.S.