IDEAS home Printed from https://ideas.repec.org/a/col/000485/018296.html

Cronies, Rents, and Import Licenses: Non-tariff Trade Controls throughout Import Substitution Industrialization (ISI) in Mexico

Author

Listed:
  • Alejandro Castaneda

Abstract

This paper fills a gap in the literature about Import-substituting Industrialization (ISI) by analyzing non-tariff trade controls, mainly import licenses, with a focus on Mexico, a case that has not been studied in detail. The core questions addressed include: Which specific pattern licensing were followed? What was the economic rationale behind such pattern, and Is there evidence that non-tariff controls were ‘captured’ that is, facilitating rent-seeking? In order to answer these questions, the project takes a qualitative and quantitative approach, using primary evidence gathered in archives as well as statistics from secondary sources, which are combined in novel ways. Specifically, here we provide descriptive statistics of the licensing system, and demonstrate that the policy lacked internal consistency, an overwhelming majority of products were protected for far longer than officially specified, and that illegal source of rents from trade –smuggling and “free perimeters”– were significant. The main findings, which shed light on larger debates about ISI are that excessive protectionism was neither effective nor sustainable and that cronyism characterized the post-Second World War process of industrialization in Mexico.

Suggested Citation

  • Alejandro Castaneda, 2020. "Cronies, Rents, and Import Licenses: Non-tariff Trade Controls throughout Import Substitution Industrialization (ISI) in Mexico," Tiempo y Economía, Universidad de Bogotá Jorge Tadeo Lozano, vol. 7(2), pages 90-118.
    • Handle: RePEc:col:000485:018296
    DOI: 10.21789/24222704.1615
    as

    Download full text from publisher

    File URL: https://doi.org/10.21789/24222704.1615
    Download Restriction: no
    File URL: https://libkey.io/10.21789/24222704.1615?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Krueger, Anne O, 1990. "Government Failures in Development," Journal of Economic Perspectives, American Economic Association, vol. 4(3), pages 9-23, Summer.
    2. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
    3. Peltzman, Sam, 1976. "Toward a More General Theory of Regulation," Journal of Law and Economics, University of Chicago Press, vol. 19(2), pages 211-240, August.
    4. Richard A. Posner, 1974. "Theories of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 335-358, Autumn.
    5. Sam Peltzman, 1989. "The Economic Theory of Regulation after a Decade of Deregulation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 20(1989 Micr), pages 1-59.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Schmidt, Dominik & Stöckl, Thomas & Palan, Stefan, 2024. "Voting for insider trading regulation. An experimental study of informed and uninformed traders’ preferences," Journal of Banking & Finance, Elsevier, vol. 169(C).
    2. Harold Mulherin, J., 2007. "Measuring the costs and benefits of regulation: Conceptual issues in securities markets," Journal of Corporate Finance, Elsevier, vol. 13(2-3), pages 421-437, June.
    3. Dennis W. Carlton & Randal C. Picker, 2014. "Antitrust and Regulation," NBER Chapters, in: Economic Regulation and Its Reform: What Have We Learned?, pages 25-61, National Bureau of Economic Research, Inc.
    4. Haselmann, Rainer & Sarkar, Arkodipta & Singla, Shikhar & Vig, Vikrant, 2022. "The political economy of financial regulation," LawFin Working Paper Series 45, Goethe University, Center for Advanced Studies on the Foundations of Law and Finance (LawFin).
    5. McShane, Michael K. & Cox, Larry A. & Butler, Richard J., 2010. "Regulatory competition and forbearance: Evidence from the life insurance industry," Journal of Banking & Finance, Elsevier, vol. 34(3), pages 522-532, March.
    6. Wallis, Joe & Dollery, Brian, 2001. "Government Failure, Social Capital and the Appropriateness of the New Zealand Model for Public Sector Reform in Developing Countries," World Development, Elsevier, vol. 29(2), pages 245-263, February.
    7. Magnus Söderberg, 2008. "Uncertainty and regulatory outcome in the Swedish electricity distribution sector," European Journal of Law and Economics, Springer, vol. 25(1), pages 79-94, February.
    8. Mountain, Bruce R., 2019. "Ownership, regulation, and financial disparity: The case of electricity distribution in Australia," Utilities Policy, Elsevier, vol. 60(C), pages 1-1.
    9. Scheeder, Thomas & Moog, Martin & Borchert, Herbert, 2002. "Bureaucratic financial burdens on privately owned forest companies: Results of a case study in three German federal states," Forest Policy and Economics, Elsevier, vol. 4(1), pages 21-31, May.
    10. Antonio Estache & Liam Wren-Lewis, 2011. "Anti-Corruption Policy in Theories of Sector Regulation," Chapters, in: Susan Rose-Ackerman & Tina Søreide (ed.), International Handbook on the Economics of Corruption, Volume Two, chapter 9, Edward Elgar Publishing.
    11. Bongini, Paola & Nieri, Laura & Pelagatti, Matteo & Piccini, Andrea, 2017. "Curbing systemic risk in the insurance sector: A mission impossible?," The British Accounting Review, Elsevier, vol. 49(2), pages 256-273.
    12. Leo Wangler, 2012. "The political economy of the green technology sector: A study about institutions, diffusion and efficiency," European Journal of Law and Economics, Springer, vol. 33(1), pages 51-81, February.
    13. Chong, Beng-Soon & Liu, Ming-Hua & Altunbas, Yener, 1996. "The impact of universal banking on the risks and returns of Japanese financial institutions," Pacific-Basin Finance Journal, Elsevier, vol. 4(2-3), pages 181-195, July.
    14. Рубинштейн Александр Яковлевич, "undated". "Методологический Анализ Теории Опекаемых Благ: Научный Доклад [methodological analysis of the Theory of Patronized Goods. Research report]," Working papers a:pru175:ye:2014:1, Institute of Economics.
    15. Waters II, William G., 2007. "Evolution of Railroad Economics," Research in Transportation Economics, Elsevier, vol. 20(1), pages 11-67, January.
    16. Anna Dimitrova, 2021. "Captured Energy Market Operation and Liberalization Efforts," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 7, pages 19-31.
    17. Sanjay Patnaik, 2019. "A cross-country study of collective political strategy: Greenhouse gas regulations in the European Union," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(7), pages 1130-1155, September.
    18. Brooks, Jonathan, 1995. "Policies and institutions in transition economies: a political economy perspective on the agri-food sector," Food Policy, Elsevier, vol. 20(6), pages 487-500, December.
    19. James W. Hughes & Michael J. Moore & Edward A. Snyder, 2002. ""Napsterizing" Pharmaceuticals: Access, Innovation, and Consumer Welfare," NBER Working Papers 9229, National Bureau of Economic Research, Inc.
    20. Kothari, S. P., 2001. "Capital markets research in accounting," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 105-231, September.

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • N76 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Latin America; Caribbean
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:col:000485:018296. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Juan Carlos Garcia Sáenz (email available below). General contact details of provider: https://edirc.repec.org/data/ectadco.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.