Endogenous Skill Acquisition and Export Manufacturing in Mexico
NBER Working Paper No. 18266
This paper presents empirical evidence that the growth of export manufacturing in Mexico during a period of major trade reforms, the years 1986-2000, altered the distribution of education. I use variation in the timing of factory openings across municipalities to show that school dropout increased with local expansions in export manufacturing. The magnitudes I find suggest that for every twenty jobs created, one student dropped out of school at grade 9 rather than continuing through to grade 12. These effects are driven by the least-skilled export-manufacturing jobs which raised the opportunity cost of schooling for students at the margin.
You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.
This paper was revised on July 2, 2013