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Employment, Wages And Economic Development In Mexico And The United States, 1965-2015: Impact Of Industry And The Effects Of Nafta

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  • GUISAN, Maria-Carmen
  • AGUAYO, Eva

Abstract

We present a comparison economic development, productivity, wages and employment in Mexico and the United States, for a period of 50 years ( 1965-2015). Accordingly to Kaldor´s contributions and the empirical evidence we think that it is very important, for to improve industrial development. Mexico experienced an average increase, of industrial real value-added per capita, around 15 USD per year (at constant prices of year 2000) both before NAFTA (period 1964-1993) and after NAFTA (for the period 1994-2012). The U.S. experienced higher increases: 75 USD per year in the first period and 39 per year in the second one. We estimate two macro-econometric equations, for both countries, showing the positive impact of industry on non industrial production and employment. Our conclusion, on the evolution of Mexico after NAFTA. is that it had some positive effects but not enough to get an important and sustained increase of industry, income per capita and wages in this country. Regarding the U.S. NAFTA has had also some positive effects, and the economy has evolved with important and sustained increase of economic development, income per capita and wages, both before and after NAFTA. Our recommendation is to increase cooperation between both countries in order to foster economic development, increasing industrial development.

Suggested Citation

  • GUISAN, Maria-Carmen & AGUAYO, Eva, 2017. "Employment, Wages And Economic Development In Mexico And The United States, 1965-2015: Impact Of Industry And The Effects Of Nafta," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 17(2).
    • Handle: RePEc:eaa:aeinde:v:17:y:2017:i:2_6
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    References listed on IDEAS

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    1. Guisan, M.Carmen & Aguayo, Eva, 2002. "Education, Industry,Trade and Development of American Countries in 1980-99," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 2(1), pages 83-106.
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    Cited by:

    1. GUISAN, Maria-Carmen, 2019. "World Development Report 2019: America," Regional and Sectoral Economic Studies, Euro-American Association of Economic Development, vol. 19(2), pages 99-110.

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    More about this item

    Keywords

    Economic Development; Macroeconometric equations of Employment; Mexico and the United States; Effects of NAFTA; Industrial Development.;
    All these keywords.

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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