Liberalization and Incentives for Labor Migration: Theory with Applications to NAFTA
One of the motivations for NAFTA from the US point of view was to reduce the" incentives for Mexican migration into the US. Unskilled rural males are a primary source of" illegal immigration and also Mexico's relatively abundant factor. This group should therefore" be made better off by trade and investment liberalization according to the traditional" Heckscher-Ohlin model. Existing evidence, along with best guesses of many experts in the" area, suggest that NAFTA is unlikely to have a significant positive impact on this group least not within the time frame of several decades. We draw on a number of recent theoretical" contributions in order to offer reasons why NAFTA may not raise the wages of unskilled" Mexican workers.
|Date of creation:||Oct 1997|
|Date of revision:|
|Publication status:||published as Trade and Factor Mobility, deMelo, J., R. Faini and K. Zimmerman, eds., London: Cambridge University Press, 1999, pp. 263-294.|
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- J.P. Neary, 1995.
"Factor Mobility and International Trade,"
CEP Discussion Papers
dp0248, Centre for Economic Performance, LSE.
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