Business Ownership and Emigration: An Empirical Analysis of the Mexico-US Case

Mexico has one of the highest self-employment rates among OECD (Organization for Economic Cooperation and Development) countries. In this paper, I study the relationship between business ownership and migration from Mexico to the US. Using a large panel data set, I found that the self-employed in Mexico have a substantially lower probability of moving north, especially illegally. Furthermore, this inverse relationship holds for rural and urban areas, communities with low and high migration rates, individuals interviewed recently and a long time ago, people working in all industries, sectors demanding different skill sets, and economic conditions in both countries. The findings highlight the role of self-employment in a developing country in the likelihood of emigration in the context of an increase in arrivals to the US during the Biden administration.   JEL Classification Codes: F22; J15; J24; J61; L26; O15