Sep14th2005

Are Mexican Immigrants Lowering Your Wages?

…the answer is no!!

David Card, economist at UC Berkeley, has a new study that states:

Mexican immigrants were historically clustered in a few cities, mainly in California and Texas. During the past 15 years, however, arrivals from Mexico established sizeable immigrant communities in many “new” cities. We explore the causes and consequences of the widening geographic diffusion of Mexican immigrants. A combination of demand-pull and supply push factors explains most of the inter-city variation in inflows of Mexican immigrants over the 1990s, and also illuminates the most important trend in the destination choices of new Mexican immigrants – the move away from Los Angeles. Mexican inflows raise the relative supply of low-education labor in a city, leading to the question of how cities adapt to these shifts. One mechanism, suggested by the Hecksher Olin model, is shifting industry composition. We find limited evidence of this mechanism: most of the increases in the relative supply of low-education labor are absorbed by changes in skill intensity within narrowly defined industries. Such adjustments could be readily explained if Mexican immigrant inflows had large effects on the relative wage structures of different cities. As has been found in previous studies of the local impacts of immigration, however, our analysis suggests that relative wage adjustments are small.(emphasis added)

Link via Tyler Cowen at Marginal Revolution.

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14 Responses to “Are Mexican Immigrants Lowering Your Wages?”


  1. Gravatar Icon 1 EMC Sep 14th, 2005 at 6:18 am

    Illegal immigrants that work on fields do not hurt our wages in fact, I’d like to know what happens to the taxes taken from their paychecks? Where does that money go or to whom? It isn’t returned to them, so that money just floats around?

  2. Gravatar Icon 2 HispanicPundit Sep 14th, 2005 at 9:10 am

    Yep, the greedy hand of government strikes again.

  3. Gravatar Icon 3 Julissa Sep 14th, 2005 at 9:17 am

    Finally! Something we can agree on.

  4. Gravatar Icon 4 HispanicPundit Sep 14th, 2005 at 9:23 am

    Finally, a response that doesn’t call me a looney conservative who doesn’t know what I am talking about, or who has no sensitivity to this…or this or that.

  5. Gravatar Icon 5 Julissa Sep 14th, 2005 at 10:33 am

    I thought I’d be easy on you since you’re probably feeling rattled from your last posting, Roberts Confirmation Decoder. OUCH!!!!

  6. Gravatar Icon 6 nebur Sep 14th, 2005 at 11:27 am

    You are a looney conservative who doesn’t know what he is talking about. You have no sensitivity to this…or this or that.

    Actually, I have no bone to pick with this post. I think you are a closet liberal. Come out, come out, wherever you are!

  7. Gravatar Icon 7 HispanicPundit Sep 14th, 2005 at 12:48 pm

    Julissa,

    Verdad. A little innocent overgeneralization and liberals get all bent out of shape. Why can’t we all just hug and get along, that’s what I say. LOL

    Nebur,

    Closet liberal huh? Well, that depends on how you define the term liberal. Have you read “Hard Heads, Soft Hearts: Tough-Minded Economics for a Just Society” by Alan S. Blinder? That is one of my favorite economic books, which is why I list it so prominently on one of my bookshelfs. Alan Blinder, professor of economics at Princeton University, is considered to fall on the liberal side of economics and he and my second (first is Thomas Sowell, of course) all time favorite economist, Milton Friedman - someone who clearly falls on the conservative side - have had their differences.

    The reason I bring up Alan Blinder is that his title means something, it shows that one must have a soft heart yet a hard head to deal with economics, specifically if your goal is more than mere rhetoric and is actually for positive change, especially for the members of society that need it most.

    So in the same spirit of Alan Blinder, I take the best of both political philosophies. Take the heart of the liberals and the mind of the conservatives, mesh the two together, and you get minority conservatives, atleast this minority conservative.

    …oh damn, look at all of the responses my “Roberts Confirmation Decoder” just got, I don’t know where I’ll find the time to give everybody the much needed response they deserve. Hopefully tonight I could sit down and respond to what I can….

  8. Gravatar Icon 8 Gerardo Sep 14th, 2005 at 9:20 pm

    HP,

    Didnt David Card also conclude that a modest raise in the minimum wage would have little or no effect on employment loss? You even have a link to the WSJ and their editorial response to Kerry and his proposed increase on the minimum wage, arguing the opposite… If this is true, imagine that for a minute,…wouldnt much of the propaganda coming from “far right” and big business about huge amounts of job losses be more of a ploy to weild their power to maintain wages low?

    See below:

    “Our findings suggest that the efficiency aspects of a modest rise in the minimum wage are overstated…. [W]e find no evidence for a large negative employment effect of higher minimum wages. Even in the earlier literature, however, the magnitude of the predicted employment losses from a much higher minimum wage would be small: the evidence at hand is relevant only for a moderate range of minimum wages, such as those that prevailed in the U.S. labor market during the past few decades. Within this range, however, there is little reason to believe that increases in the minimum wage will generate large employment losses.
    ~David Card and Alan B. Krueger, Myth and Measurement: The New Economics of the Minimum Wage, (Princeton: Princeton University Press, 1995, p. 393). “

  9. Gravatar Icon 9 HispanicPundit Sep 14th, 2005 at 9:31 pm

    Good point Gerardo, and the more important part is, as economist Bryan Caplan explained so well here, the two are mutually exclusive, they can’t both be true at the same time.

    So we have three choices here, A. Card’s research is wrong on the minimum wage, or B. Card’s research is wrong regarding immigration, or C. All of Card’s research is wrong.

    Personally, because I have seen so much more research rebutting Card’s minimum wage conclusions, for example, here, here, and here, I choose A. Of course that doesn’t mean C can’t be right, but given Card’s status in the economic community, I figure he deserves atleast the benefit of the doubt, which again is why I choose A.

    Thanks for chiming in!!

  10. Gravatar Icon 10 oso Sep 14th, 2005 at 11:02 pm

    Nebur’s so right. Truth is, we’re both Classical Liberals I’m more liberal and you’re more classical.

    The HP I know woulda written up there “… the answer is hell no.” Come on dude, no holding back.

    Let’s get some Pho tomorrow foo.

  11. Gravatar Icon 11 HispanicPundit Sep 14th, 2005 at 11:16 pm

    I’m down bro, holla at yah boy!!!

    As far as my liberal response goes, I only say hell no to limousine liberalism, inner city liberalism, on the other hand, is something I am much more comfortable with. Limousine liberalism is something I can’t even begin to comprehend. :-)

  12. Gravatar Icon 12 Scott Sep 16th, 2005 at 9:20 pm

    Good distinction between limousine liberalism & inner city liberalism. Seriously, I’d love to hear you draw that distinction out more, since it is a huge distinction. To me, it seems it might be similar to the post you wrote recently about relativism, si?
    As for me, I seem to bounce back and forth between the two camps (liberal & conservative, not limousine & inner city. Just inner city on that one…). Reading your stuff makes me think I’m a closet conservative at times. At other times, I must be a liberal ’cause you talk nonsense… Not really nonsense, but you know…

  13. Gravatar Icon 13 HispanicPundit Sep 16th, 2005 at 10:27 pm

    Hey Scott,

    Long time no see, glad to have you back bud!!! It seems the upgrade to my new spam filter fixed the situation, since you are no longer blocked from discussions. Also, when you have time, It’d help personalize the conversation if you got your own gravatar. It’s free and painless, yet it adds a lot of value to the convo if people can atleast see something from you, instead of that generic picture I have up. Just look at how much value my own personal picture adds. :D

    As far as inner city liberalism vs. limousine liberalism, I’ve been meaning to blog on that for some time now. It is a lot easier to identify in person than write about, but I would say the main differences lie in the social issues. For example, inner city liberalism tends to be much more religious, or atleast much more tolerant of religion. Limousine liberalism, on the other hand, tends to be strongly secular, and in many cases anti-religious. So, for example, you would have a higher percentage of inner city liberals being against abortion, gay marriage, and tolerant of religious symbols in public.

    Than there is the issue of priorities. Inner city liberalism tends to be much more interested in today, and practical about the solutions. Limousine liberalism tends to be much more utopian, and always pursuing some ideal goal no matter what the costs. A good example of this would be environmental issues. Limousine liberals would place a much higher priority on environmental regulations, Kyoto, and other policies that are geared towards improving the environment (whether they actually do that is a separate topic), whereas inner city liberals would place a higher priority on the amount of job losses that they would suffer because of such regulations.

    Like I said above, I am much more comfortable with inner city liberalism, in fact, I would argue that I still am an inner city liberal, I just have different ways (I would say better ways) of accomplishing the same goals. However, limousine liberalism is something very foreign to me, something that I would never be able to relate to.

    Btw, me, talk nonsense?!?!? That’s NONSENSE!! LOL

  1. 1 HispanicTips Trackback on Sep 14th, 2005 at 6:32 am

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