IDEAS home Printed from https://ideas.repec.org/a/oup/cambje/v40y2016i2p507-539..html

Structural change, the real exchange rate and the balance of payments in Mexico, 1960–2012

Author

Listed:
  • Carlos A. Ibarra
  • Robert A. Blecker

Abstract

This paper estimates a structural model of the balance of payments, with disaggregated exports (manufactures and other) and imports (final and intermediate), and a reduced-form model of the trade balance for the Mexican economy. The analysis identifies structural changes in the composition of Mexico’s trade and the parameters that affect it across five subperiods marked by statistical breakpoints. The results indicate that a tightening of the balance-of-payments constraint may account for the post-liberalisation slowdown in Mexico’s growth only during certain subperiods and that the impact of real exchange rate changes on the trade balance has diminished, most likely as a result of the increasing integration of export industries into global supply chains. The results also suggest an asymmetry, whereby a country cannot sustain growth above the rate consistent with balance-of-payments equilibrium, as expected, but it can grow persistently below that rate when other constraints are more binding.

Suggested Citation

  • Carlos A. Ibarra & Robert A. Blecker, 2016. "Structural change, the real exchange rate and the balance of payments in Mexico, 1960–2012," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 40(2), pages 507-539.
    • Handle: RePEc:oup:cambje:v:40:y:2016:i:2:p:507-539.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/cje/beu079
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Civcir, Irfan & Panshak, Yohanna & Ozdeser, Huseyin, 2021. "A multi-sectoral balance of payments constrained growth approach with intermediate imports: The case of Nigeria," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 240-250.
    2. Ricardo Azevedo Araujo & Matheus Silva Paiva & Júlio Fernando Costa Santos, 2019. "The role of intermediate inputs in a multisectoral balance-of-payments-constrained growth model: the case of Mexico," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-24, December.
    3. Tamer Rawashdeh & Mahmoud Al-Rdaydeh & Basem Hamouri, 2020. "The Effect of International Currency Crises on the Balance of Payments: Evidence From Jordan," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(5), pages 275-284, October.
    4. Lewis Chimfwembe & Kevin S. Nell, 2023. "The relevance of Thirlwall’s growth law in the Zambian economy," Metroeconomica, Wiley Blackwell, vol. 74(4), pages 777-805, November.
    5. Kvedaras, Virmantas & Garcimartín, Carlos & Astudillo, Jhonatan, 2020. "Balance-of-Payments constrained growth dynamics: An empirical investigation," Economic Modelling, Elsevier, vol. 89(C), pages 232-244.
    6. Porcile, Gabriel & Sartorello Spinola, Danilo & Yajima, Giuliano, 2020. "Patterns of growth in structuralist models: The role of the real exchange rate and industrial policy," MERIT Working Papers 2020-027, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    7. Tostes Lamonica, Marcos & Feijó, Carmem Aparecida & Punzo, Lionello Franco, 2021. "The growth trajectories of Argentina, Brazil, Chile and Mexico: a comparative view through the framework space lens," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), August.
    8. Robert A. Blecker, 2022. "New advances and controversies in the framework of balance‐of‐payments‐constrained growth," Journal of Economic Surveys, Wiley Blackwell, vol. 36(2), pages 429-467, April.
    9. Thomas H. W. Ziesemer, 2023. "Semi-endogenous growth in a non-Walrasian DSEM for Brazil: estimation and simulation of changes in foreign income, human capital, R&D, and terms of trade," Economic Change and Restructuring, Springer, vol. 56(2), pages 1147-1183, April.
    10. Basil Oberholzer, 2023. "Green Growth and the Balance‐of‐payments Constraint," Development and Change, International Institute of Social Studies, vol. 54(4), pages 804-840, July.
    11. Ismail Adigun Olayemi & Lateef Olawale Adedeji & Bashir Ayomide Adenekan & Omolola Raliat Owonikoko, 2017. "Is Nigerian Growth Trade-Led?," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 10(3), pages 80-89, September.
    12. Blecker, Robert A. & Moreno Brid, Juan Carlos & Salat, Isabel, 2017. "Trumping the NAFTA renegotiation An alternative policy framework for Mexican-United States cooperation and economic convergence," Sede Subregional de la CEPAL en México (Estudios e Investigaciones) 42579, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    13. Jiménez López, Edison & Mungaray Lagarda, Alejandro & Osorio Novela, Germán, 2020. "The manufacturing industry in Mexico: a history of production without distribution," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), August.

    More about this item

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy

    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:oup:cambje:v:40:y:2016:i:2:p:507-539.. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/cje .

    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.