SciELO - Scientific Electronic Library Online

vol.14 issue2When Children Become Migrants: Children Detained in Mexico and the Dislocation of the Human Rights Discourse author indexsubject indexsearch form
Home Pagealphabetic serial listing  

Services on Demand




Related links

  • Have no similar articlesSimilars in SciELO



On-line version ISSN 2448-7228Print version ISSN 1870-3550


CARBAJAL-DE-NOVA, Carolina. The Manufacturing Wage Gap: Mexico and the United States. Norteamérica [online]. 2019, vol.14, n.2, pp.67-94.  Epub Sep 11, 2020. ISSN 2448-7228.

The main purpose of this article is to estimate the pace and extent of the manufacturing wage gap between Mexican and U.S. production and nonsupervisory workers. It also evaluates a main tenet of international trade, putting to the test the factor price equalization (FPE) theorem for the pre-NAFTA (North America Free Trade Agreement) period of 1987-1994 and two NAFTA sub-periods, 1995-2006 and 2007-2013. According to the aforementioned theorem, trade openness should render wages in both countries comparable and eventually convergent. The estimation technique used to test this theorem relies on an error correction model in a time series setting, using monthly data. The introduction of a real exchange rate as an exogenous variable becomes relevant. The author finds a substantial wage gap between production workers in the two countries, as convergence has not taken place. As a result, the FPE theorem is not valid for the present case. The wage gap between production workers continues to be substantial, with a tendency to expand.

Keywords : wage gap; Mexico; United States; NAFTA; factor price equalization theorem.

        · abstract in Spanish     · text in English     · English ( pdf )