# 1. Introduction

**Migration is an important determinant of economic growth and enhances labor force utilization efficiency, both on the international and national levels.** Internal migration, although less investigated than international migration, is a key mechanism for adjustment to regional economic shocks. Since the work of Ravenstein (1885), the movement of people across different areas has been studied as a complex phenomenon, and extensive literature has been developed.

**Mexico displays high levels of spatial inequality across states in both income and human development indicators.** Indeed, there are significant disparities in labor market outcomes across states. Labor force participation and wages are higher in urban areas, Northern regions, Mexico City, and regions where tourism plays an important role. Female labor force participation in Baja California was close to that in Denmark or England in 2019 and was higher than in the US and Germany. On the other hand, women’s labor force participation in Chiapas was lower than in Turkey, one of the lowest among OECD countries. Furthermore, five states in the Southwestern and Eastern regions concentrate most of the municipalities where the incidence of poverty has remained significantly higher than the national average for more than twenty years: Veracruz, Chiapas, Guerrero, Puebla, and Oaxaca (Pereira and Soloaga, 2014). These states also display the highest net emigration flows in 2020.

**Given the large differences in labor market outcomes across states and municipalities in Mexico, a**

**natural question that arises is whether women migrate seeking better economic opportunities.** The literature on returns to migration suggests that emigration allows both low- and high-skilled migrants to substantially increase their incomes and wellbeing.<sup>2</sup> However, many macroeconomic and sociodemographic factors may determine the probability of migration. Women may face specific barriers in their place of origin that might prevent them from migrating and accessing better economic opportunities.

**This study analyzes the determinants of interstate migration in Mexico during the period 2015-2020 and the earnings gains from the migration decision.** The study focuses on women and identifying macroeconomic push and pull factors influencing internal mobility flows and individual factors affecting the propensity to migrate. Push and pull factors at the aggregate level are estimated using a gravity-type model, while the propensity to migrate is estimated using a discrete choice model that accounts for different migration reasons. Also, this study aims to measure whether women in Mexico successfully increase their income and wellbeing by migrating internally. Income gains are estimated using a double selection model that accounts simultaneously for the migration and work decisions.

**The primary source of information is the latest Census of Population and Housing (Census of 2020).** The Census allows for the identification of internal migrants during the period 2015-2020, and it also provides information on the reasons for migration. This study limits the internal migration analysis to migration across states, including the country's capital Mexico City. There are 32 federal entities in Mexico: 31 states and the capital Mexico City, which constitutes a separate entity without being formally a state.

**Around 3.4 percent of the population residing in Mexico in 2015 moved to another state during the period 2015-2020, representing nearly four million people.** The internal migration rate was higher among men than women (3.6 against 3.3 percent). However, women accounted for almost half (49.8 percent) of the total internal migrants in 2020. The migration patterns during the period 2015-2020 provide evidence

> 2 See Gibson and McKenzie, 2012; Clemens, 2010; McKenzie et al., 2010; Stillman et al., 2009; Clemens et al., 2008; among others.

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