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Concepts and Measurements of Economic Interdependence: The Case of the United States and Mexico

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  • del Rosío Barajas-Escamilla María

    (Social Studies Department, El Colegio de la Frontera Norte, Tijuana, BC 22560, Mexico)

  • Kia Amir
  • Sotomayor Maritza

    (Finance and Economics Department, Utah Valley University, Orem, UT 84058–5999, USA)

Abstract

We developed a theoretical model capable to analyze U.S. fiscal and monetary policy effects on Mexican exports in order to provide an alternative approach to the study of economic interdependence. The model was estimated for the sample period of 1980–2013. The existing literature evidences quantified interdependence through trade flows and ignores the role of the U.S. fiscal and monetary policies. This paper uses the concept of sensitivity, from the economic interdependence literature, to verify the long and short run relationships between the U.S. and Mexico in a context of trade integration. Our findings confirm Mexico’s sensitivity to unanticipated shocks in particular coming from the U.S. monetary policy, the exchange rate and the world oil price.

Suggested Citation

  • del Rosío Barajas-Escamilla María & Kia Amir & Sotomayor Maritza, 2016. "Concepts and Measurements of Economic Interdependence: The Case of the United States and Mexico," Global Economy Journal, De Gruyter, vol. 16(1), pages 63-90, March.
    • Handle: RePEc:bpj:glecon:v:16:y:2016:i:1:p:63-90:n:6
    DOI: 10.1515/gej-2015-0034
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    References listed on IDEAS

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    1. Roman Matkovskyy, 2019. "Extremal Economic (Inter)Dependence Studies: A Case of the Eastern European Countries," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 17(3), pages 667-698, September.

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