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Offshoring and Volatility: Evidence from Mexico’s Maquiladora Industry

In: International Macroeconomic Interdependence

Author

Listed:
  • Paul R. Bergin
  • Robert C. Feenstra
  • Gordon H. Hanson

Abstract

This chapter addresses the question of what promotes international macroeconomic spillovers by studying the particular case of Mexico, where recessions arising in the US seem to be transmitted with amplification. This particularly strong positive comovement is associated with the rise of offshoring production, the arrangement whereby firms carry out particular stages of production abroad. Comparing employment in the offshoring sectors across countries, shocks arising in the US generate fluctuations in Mexico twice as large as in the US…

Suggested Citation

  • Paul R. Bergin & Robert C. Feenstra & Gordon H. Hanson, 2017. "Offshoring and Volatility: Evidence from Mexico’s Maquiladora Industry," World Scientific Book Chapters, in: International Macroeconomic Interdependence, chapter 2, pages 31-44, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789813225343_0002
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    Keywords

    Macroeconomics; International; Cooperation; Business Cycles; Exchange Rate; Current Account;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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