Did Trade Liberalization Help Women? The Case of Mexico in the 1990s
With the signing of the North American Free Trade Agreement (NAFTA) in 1994, Mexico entered a bilateral free trade agreement which not only lowered its own tariffs on imports but also lowered tariffs on its exports to the U.S. We find that women's relative wage increased, particularly during the period of liberalization. Both between and within-industry shifts also favored female workers. With regards to between-industry shifts, tariff reductions expanded sectors which were initially female intensive. With regards to within-industry shifts, we find a positive association between reductions in export tariffs (U.S. tariffs on Mexican goods) and hiring of women in skilled blue-collar occupations. Finally, we find suggestive evidence that household bargaining power shifted in favor of women. Expenditures shifted from goods associated with male preference, such as men's clothing and tobacco and alcohol, to those associated with female preference such as women's clothing and education.
We would like to thank Carolina Villegas-Sanchez for helping us with the programs and we would also like to thank INEGI officials for granting on-site access to the establishment level data used in this study under the commitment of complying with the confidentiality requirements set by the Mexican Laws and in particular, to Maria Luisa Meza Leon, Lizi Ivette Gonzalez Jimenez and Gabriel Romero Velasco. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Ernesto Aguayo-Tellez , Jim Airola , Chinhui Juhn , Carolina Villegas-Sanchez (2014), Did Trade Liberalization Help Women? the Case of Mexico in the 1990s, in Solomon W. Polachek , Konstantinos Tatsiramos (ed.) New Analyses of Worker Well-Being (Research in Labor Economics, Volume 38) Emerald Group Publishing Limited, pp.1 - 35