Skill premia in Mexico: demand and supply factors
MONTES ROJAS, GABRIEL VICTORIO
APPLIED ECONOMICS LETTERS (PRINT)
Año: 2006 vol. 13 p. 917 - 917
Skill premia trends for the Mexican urban labour market are analysed, decomposing into demand and supply factors. Moreover, among the former both between and within effects are studied, in line with the Katz and Murphy decomposition. It is shown that demand factors are more important for explaining the initial increment in skill premia, but supply factors are responsible for driving them down. It is concluded that the North American Trade Agreement (NAFTA) favours unskilled labour.