Cross-Border Earnings of US Natives Along the US-Mexico Border

Objective. This study explores whether the earnings of U. S.-born cross-border workers differ from those of their U. S.-employed counterparts. We also analyze whether the cross-border/non-cross-border wage differential changed during the 1990s-a decade when U.S.-Mexico trade intensified and the maquiladora industry expanded. Methods. Employing decennial U. S. Census data from 1990 and 2000, this article estimates earnings functions and uses wage decomposition analysis to study changes in the earnings of U. S.-born Hispanic and non-Hispanic cross-border workers. Results. The number of U. S.-native cross-border workers, while relatively small, increased significantly between 1990 and 2000, as did their earnings. A closer examination reveals that this cross-border earnings premium only developed among non-Hispanics. Conclusions. These findings indicate that some U. S. natives find lucrative employment opportunities on the Mexican side of the border, which might be diminished by additional restrictions for U. S.-born residents to easily cross back and forth into Mexico.