Immigration Policy and the Rise of Self-Employment among Mexican Immigrants

Abstract

The recent dramatic growth in self-employment among Mexican immigrants in the United States in the past two decades is a puzzling trend, in stark contrast to the stagnant growth or even decline among other demographic groups. The authors propose that the expansion of interior immigration enforcement, a characteristic of the US immigration policy during that time span, contributed to this unique trend by pushing Mexican immigrants into self-employment as an alternative livelihood. Exploiting temporal and geographic variation in immigration enforcement measures from 2005 to 2017, the authors show that tougher enforcement has been responsible for approximately 15% of the rise in Mexican self-employment in the United States.