Do undocumented migrants earn lower wages than legal immigrants? New evidence from Mexico

Abstract

"This article examines the extent to which undocumented status lowers wage rates among immigrants to the United States from four Mexican communities. Regression equations were estimated to determine the effect of legal status on wages independent of other demographic, social and economic variables, and special efforts were made to control for possible sample selection biases. Findings suggest that the data are relatively free from selectivity problems that have characterized earlier studies, and that legal status had no direct effect on wage rates earned by male migrants from the four communities. Legal status also had little effect on the kind of job that migrants take in the United States, but it does play an important indirect role in determining the length of time that migrants stay in that country. By reducing the duration of stay, illegal status lowers the amount of employer-specific capital accruing to undocumented migrants, and thereby lowers wage rates relative to legal migrants." Data are for 1982-1983.