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Dinámicas de la inversión pública subnacional y la inversión extranjera en México: un análisis de competencia, desplazamiento y aceleración fiscal

Author

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  • Mendoza Velázquez, Alfonso

    (Universidad Popular Autónoma del Estado de Puebla)

  • García Flores , Miguel Ángel

    (Universidad Popular Autónoma del Estado de Puebla)

  • Mendoza Martínez, Diego

    (The University of Chicago)

Abstract

This article examines the impact of the federal financing types on the relationship between subnational public investment and foreign direct investment (FDI) in Mexico. Through the use of dynamic and threshold models, it identifies patterns of competition, crowding out, and complementarity between these investments, and determines the FDI threshold beyond which local public investment turns positive. At low levels of FDI, governments face negative incentives that weaken subnational investment spending, whereas high FDI levels foster greater complementarity between the two types of investment. Our analysis provides additional evidence that conditional and unconditional federal transfers exert differentiated effects. While contributions tend to promote public investment at low levels of FDI, participations foster complementarity when FDI exceeds the estimated threshold. These findings suggest that intergovernmental financing mechanisms can either amplify or inhibit the benefits of FDI, depending on the investment regime and the type of federal transfer.

Suggested Citation

  • Mendoza Velázquez, Alfonso & García Flores , Miguel Ángel & Mendoza Martínez, Diego, 2026. "Dinámicas de la inversión pública subnacional y la inversión extranjera en México: un análisis de competencia, desplazamiento y aceleración fiscal," El Trimestre Económico, Fondo de Cultura Económica, vol. 93(370), pages 341-372, April-Jun.
    • Handle: RePEc:elt:journl:v:93:y:2026:i:370:p:341-372
    DOI: https://doi.org/10.20430/ete.v93i370.2695
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    Keywords

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    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • P45 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - International Linkages
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock

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