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Stationarity, structural breaks, and economic growth in Mexico: 1895-2008

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  • Antonio E. Noriega
  • Cid Alonso Rodríguez-Pérez

Abstract

This paper shows that the evolution of the level of Mexico real and real per capita output between 1895 and 2008 can be adequately described through a trendstationary model, affected by 4 structural breaks, which occurred at dates that seem to coincide with domestic institutional arrangements, wars, and financial and economic crises. These changes are modeled through logistic smooth transition functions, in which transition periods are endogenously estimated. In terms of growth rates, our results indicate that for Mexico real and real per capita GDP, there are four stationary growth paths, separated by three transition periods. For instance, for real GDP we identify the following stationary growth paths: 1895-1924, 1935-1952, 1956-1978, and 1989-2008, separated by three transition periods: 1925-1934, 1953-1955, and 1979-1988.

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File URL: http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/%7BDEA7E41B-4B0E-BC94-A285-70F54C9861C8%7D.pdf
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Bibliographic Info

Paper provided by Banco de México in its series Working Papers with number 2011-11.

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Date of creation: Oct 2011
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Handle: RePEc:bdm:wpaper:2011-11

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Web page: http://www.banxico.org.mx
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Keywords: Gross domestic product; economic growth; stationarity; unit root; structural break; logistic function; smooth transition.;

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