Wage Inequality in Post-Reform Mexico

Using the Mexican Household Income and Expenditure Survey (ENIGH) covering 1984-2000 we analyze wages and employment in Mexico after trade liberalization and domestic reforms. We find that wage inequality and returns to postsecondary schooling increased rapidly during 1984-1994 but stabilized since that period. The end of inequality growth was due to a severe macroeconomic crisis which adversely impacted the better educated, an increase in education levels at the end of the 1990s, and a slowdown in skill demand in the latter half of the 1990s. Between-industry shifts, consistent with trade-based explanations, account for a part of the increase in skill demand during 1984-1994, but these types of movements actually reduced the demand for skill in the latter part of the 1990s. The equalizing impact of trade was offset by within-industry demand shifts which continued to favor more educated workers. The Mexican experience in the 1990s suggests that market-oriented reforms have a sharp initial impact on inequality which dissipates over time. However, the opening of the economy to trade, foreign capital, and global markets also leads to a more long-run increase in the demand for skill.

Did Trade Liberalization Help Women? The Case of Mexico in the 1990s

With the signing of the North American Free Trade Agreement (NAFTA) in 1994, Mexico entered a bilateral free trade agreement which not only lowered its own tariffs on imports but also lowered tariffs on its exports to the U.S. We find that women’s relative wage increased, particularly during the period of liberalization. Both between and within-industry shifts also favored female workers. With regards to between-industry shifts, tariff reductions expanded sectors which were initially female intensive. With regards to within-industry shifts, we find a positive association between reductions in export tariffs (U.S. tariffs on Mexican goods) and hiring of women in skilled blue-collar occupations. Finally, we find suggestive evidence that household bargaining power shifted in favor of women. Expenditures shifted from goods associated with male preference, such as men’s clothing and tobacco and alcohol, to those associated with female preference such as women’s clothing and education.

Does trade liberalization help woman? The case of Mexico in the 1990s

With the signing of the North American Free Trade Agreement (NAFTA) in 1994, Mexico entered a bilateral free trade agreement which not only lowered its own tariffs on imports but also lowered tariffs on its exports to the U.S. We find that women’s relative wage increased, particularly during the period of liberalization. Both between and within-industry shifts also favored female workers. With regards to between-industry shifts, tariff reductions expanded sectors which were initially female intensive. With regards to within-industry shifts, we find a positive association between reductions in export tariffs (U.S. tariffs on Mexican goods) and hiring of women in skilled blue-collar occupations. Finally, we find suggestive evidence that household bargaining power shifted in favor of women. Expenditures shifted from goods associated with male preference, such as men’s clothing and tobacco and alcohol, to those associated with female preference such as women’s clothing and education

Did Trade Liberalization Help Women? The Case of México in the 1990s

Abstract: With the signing of the North American Free Trade Agreement (NAFTA) in 1994, Mexico entered a bilateral free trade agreement which not only lowered its own tariffs on imports but also lowered tariffs on its exports to the U.S. We find that women’s relative wage increased, particularly during the period of liberalization. Both between and within-industry shifts also favored female workers. With regards to between-industry shifts, tariff reductions expanded sectors which were initially female intensive. With regards to within-industry shifts, we find a positive association between reductions in export tariffs (U.S. tariffs on Mexican goods) and hiring of women in skilled blue-collar occupations. Finally, we find suggestive evidence that household bargaining power shifted in favor of women. Expenditures shifted from goods associated with male preference, such as men’s clothing and tobacco and alcohol, to those associated with female preference such as women’s clothing and educatio

Labor supply in response to remittance income: the case of Mexico

The growth in the flow of international remittance income in many developing countries has increased attention towards remittances as a development mechanism. This study attempts to understand to what degree labor patterns are affected by the receipt of remittances. Using nationally representative household income and expenditure data for Mexico, I analyze the effect of remittance income on labor supply decisions. I find that household labor supply in response to remittance income is consistent with findings which measure labor supply behavior in the presence of other forms of unearned income in different settings. That is, remittance receipts are associated with fewer hours of work and income elasticities are estimated in the range of -.006 to -.03. This finding attenuates to some degree the measure of the impact of remittances in the receiving country’s aggregate output

On the Use of Remittance Income in Mexico

DRMI Working Paper SeriesThe series is intended to convey the preliminary results of [DRMI] ongoing research. The research described in these papers is preliminary and has not completed the usual review process for Institute publications. We welcome feedback from readers and encourage you to convey your comments and criticisms directly to the authors

Labor Supply in Response to Remittance Income: The Case of Mexico

DRMI Working Paper SeriesThe series is intended to convey the preliminary results of [DRMI] ongoing research. The research described in these papers is preliminary and has not completed the usual review process for Institute publications. We welcome feedback from readers and encourage you to convey your comments and criticisms directly to the authors

An Economic Assessment of Solar PV Systems

DRMI Working Paper SeriesThe series is intended to convey the preliminary results of [DRMI] ongoing research. The research described in these papers is preliminary and has not completed the usual review process for Institute publications. We welcome feedback from readers and encourage you to convey your comments and criticisms directly to the authors