Document Type

Article

Publication Date

10-2010

Abstract

This paper studies the effects of capital and labor mobility on real wages across Mexican states for the period 1997–2006. Employing dynamic panel data methods, we find: (1) strong positive effects on real wages from foreign direct investment (FDI) and from migration; (2) domestic and foreign migration provide similar wage effects; and (3) alternative partitions indicate that real wages are more sensitive to FDI-related fluctuations across states with relatively lower wages and migration levels. Overall, these results provide support that real wages respond positively to fluctuations in capital flows and labour movements as predicted from the theory.

Comments

© 2010 Informa UK Limited. Original published version available at https://doi.org/10.1080/00220381003599428

First Page

1523

Last Page

1542

Publication Title

The Journal of Development Studies

DOI

10.1080/00220381003599428

Included in

Finance Commons

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