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The international financial crisis of 2008 and some of its economic effects on Mexico

Author

Listed:
  • Gloria de la Luz Juárez

    (Universidad Autónoma Metropolitana, Unidad Azcaptzalco, México)

  • Alfredo Sánchez Daza

    (Universidad Autónoma Metropolitana, Unidad Azcaptzalco, México)

  • Jesús Zurita González

    () (Universidad Autónoma Metropolitana, Unidad Azcaptzalco, México)

Abstract

The international financial crisis of 2008 due mainly to the subprime mortgage deriva¬tives crisis in the United States but with world economic effects, had a significant negative repercussion on the Mexican economy mostly trough the real channel of the Mexican ex¬ports, which was reflected upon manufacturing and industrial production, particularly in the Northern states of Mexico. Granger causality tests show that the industrial production of the United States causes Mexican manufacturing production. A VAR econometric mo¬del which has U.S. industrial production as an exogenous variable indicates that the real exchange rate has a negative short-run effect on Mexican manufacturing production, and that fiscal and monetary policies have a small effect on manufacturing output. Moreover, it shows that these policies have been pro-cyclical in the past. To counter negative effects from international economic crises Mexico needs to develop a stronger domestic market and be able to forge counter cyclical monetary and fiscal policies.

Suggested Citation

  • Gloria de la Luz Juárez & Alfredo Sánchez Daza & Jesús Zurita González, 2015. "The international financial crisis of 2008 and some of its economic effects on Mexico," Contaduría y Administración, Accounting and Management, vol. 60(6), pages 128-146, Octubre-D.
  • Handle: RePEc:nax:conyad:v:60:y:2015:i:6:p:128-146
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    File URL: http://www.cya.unam.mx/index.php/cya/article/view/916
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    Keywords

    International financial crisis; Subprime mortgage derivatives; Industrial production; Granger causality; Domestic market;

    JEL classification:

    • F3 - International Economics - - International Finance
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F6 - International Economics - - Economic Impacts of Globalization

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