Why do Mexican Americans earn low wages?

Using Current Population Survey data from November 1979 and 1989, I find that Mexican Americans earn low wages primarily because they possess less human capital than other-workers, not because they receive smaller labor market rewards for their skills. Among third-and higher-generation men in 1989, Mexicans averaged 21 percent lower wages than non-Hispanic whites, which is roughly similar to the wage deficit for blacks. For Mexicans, more than three-quarters of the wage gap is attributable to their relative youth, English language deficiencies, and especially their lower educational attainment. By contrast, these variables explain less than a third of the black-white wage gap.