IMPLICATIONS OF A NORTH-AMERICAN FREE-TRADE AGREEMENT FOR MEXICAN MIGRATION INTO THE UNITED-STATES

In the short-to-medium run, a North American Free Trade Agreement (NAFTA) is likely to increase pressures for undocumented migration from Mexico to the US. But given the NAFTA will be phased-in over a 15yr period, the migration effect need not be sudden or overwhelming. If free trade brings about an improvement in the Mexican economy relative to the US economy, the incentives for undocumented migration are likely to weaken. The authors calculate estimates of the undocumented gross annual migration flow by stipulating various degrees of changes in the relative level of unemployment and of wages rates between the US and Mexico. These estimates show that narrowing the wide economic differentials between the two countries could substantially reduce the undocumented flow. -from Authors