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- [Figure D.2 should be here] A.2 Discussion on the threads to identification of short-run effects The main threat to my identification strategy is that the devaluation of the Peso might have changed the trading relations between US and Mexico. This can have effects on the labor market, as Autor et al. (2013a) show for the case of import competition from China. However, US imports from Mexico did not increase, relative to the trend, as shown in Figure D.3 in the Appendix. This figure also shows that exports from the US to Mexico in fact saw a significant decrease. If states exporting to Mexico are the same states where Mexican immigrants entered, then I might be confounding the effect of trade and immigration. Fortunately, even if there is some overlap, immigrants do not systematically enter states that export heavily to Mexico.
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- [Table D3 should be here] In Table D3 I compare observable characteristics of Mexicans in 1994, in 1995 and 1996. Most variables are not distinguishable from 0 and for those that are different from 0 the differences are quantitatively very small.57 In Figure D.2 I show in more detail the most important observable characteristic both for my longrun identification strategy and for wage determination: age. The figure shows that the age distribution of Mexican arrivals is very similar across years during the 1990s. The total flow of Mexicans is higher in 1995 than in other years, despite that all these data is based on the Census 2000 question on the year of arrival, and thus, it capture the high numbers of arrivals occurring close to the Census question, but the distribution, shown in the bottom graph, is almost identical.
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- Finally, it is worth mentioning that the networks instrument that I use could be improved if I had information on the exact place of origin of the immigrants within Mexico. As Munshi (2003) shows, there are tight links between particular parts of Mexico and particular destinations in the US. In this context, I could potentially use the intensity of the crisis across Mexican locations to better predict the intensity of the flows into the US. Unfortunately, data of this sort, representative at the Mexican national level is only available starting at around 2006, see Caballero et al. (2018). A.3 Geography robustness An important robustness check is to see whether the short-run results on wages are driven by California or Texas exclusively. I do so by excluding these two states, from the OLS and IV regressions presented in Table 3. [Table D5 should be here]
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- To avoid the possible contamination of my estimates from the direct effect of trade on wages I include in some of my regressions (log) US states’ exports to Mexico and (log) state GDP. This should control for the possible direct effect of trade on the US labor market.59 Another thread to identification is that maybe the characteristics of Mexicans who arrived in 1995 are different than Mexicans arriving in other years. As mentioned in section 2.1 and discussed in more detail in the Appendix section A.1, Figure D.2 and Table D3, this does not seem to be the case. The observable characteristics of the Mexican immigrants in the US do not change significantly before and after 1995.
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