Labor-Market Discrimination, Undocumented-Worker Effects, and the Earnings of Mexican American Men

This working paper is a study of discrimination and persistently low earnings of the Mexican American labor market in the U.S. The study of the inverse relationship between the labor-market density and the earnings of Mexican Americans yields fruitful insights into the formation of Mexican American earnings. This empirical effort leads to an interesting result: the inverse relationship is strongest among Mexican Americans who are either non-natives or in low-skill occupations. This result raises questions about earlier research that has recommended increasing the low earnings of Mexican Americans by exclusively focusing on human-capital enhancing programs, ignoring discrimination and immigration reform