The International Transmission of Local Economic Shocks Through Migrant Networks / María Esther Caballero, Brian Cadena, Brian K. Kovak.

Format:

Book

Author/Creator:

Caballero, María Esther.

Contributor:

National Bureau of Economic Research.

Cadena, Brian.

Kovak, Brian K.

Series:

Working Paper Series (National Bureau of Economic Research) no. w28696.

NBER working paper series no. w28696

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2021.

Summary:

Using newly validated data on geographic migration networks, we study how labor demand shocks in the United States propagate across the border with Mexico. We show that the large exogenous decline in US employment brought about by the Great Recession affected demographic and economic outcomes in Mexican communities that were highly connected to the most affected markets in the US. In the Mexican locations with strong initial ties to the hardest hit US migrant destinations, return migration increased, emigration decreased, and remittance receipt declined. These changes significantly increased local employment and hours worked, but wages were unaffected. Investment in durable goods and children's education also slowed in these communities. These findings document the effects in Mexico when potential migrants lose access to a strong US labor market, providing insight regarding the potential impacts of stricter US migration restrictions.

Notes:

Print version record

April 2021.