Environmental Problems, Immigration, and Trade
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Issues between countries with common borders can be complex and involve non-trade issues as well as trade issues. The American-Mexican trading relationship is one of the most interesting. Recorded trade has increased from US $80 billion before the North American Free Trade Agreement (NAFTA) to US $200 billion in 1998, making Mexico the second largest U.S. trading partner. Simultaneously, the magnitude of American-Mexican non-trade issues has been growing as well. First, food safety and environmental quality have become major trade issues because of differences in standards between the two countries (Zepp, Kuchler, and Lucier, 1998). Second, Mexico is the primary source of illegal immigration into the United States, and much of it enters the agricultural labor force. Illegal Mexican immigration has far exceeded legal quotas for decades and has become a subject of agricultural economic research (Torok and Huffman, 1986). Third, Mexico is the primary source of illegal drugs for the United States. About 70 percent of the illegal drugs entering the United States in 1996 came from Mexico. Much of the increased smuggling has occurred with increased trade under NAFTA (Silvey and Brody, 1996).
KeywordsConvex Hull Illegal Immigration North American Free Trade Agreement Nash Bargaining Solution Reservation Utility
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