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Public Spending in Mexico: How to Enhance Its Effectiveness

  • Bénédicte Larre
  • Marcos Bonturi
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    Public sector reforms and a refocusing of spending, partly through privatisation, have created a leaner and more effective government in Mexico. Primary expenditure, at around 18 per cent of GDP in 1999, is less than half the average for the OECD. At the same time, there are important spending requirements to create the basis for strong sustainable growth over the medium term. The backlog in basic infrastructure is considerable and areas such as education and health will require a steady expansion of budget resources. Specific measures to fight poverty are also needed. Inadequate tax resources and a heavy reliance on volatile oil-related revenue have been important factors impeding the development of essential public programmes. In this respect, given the sizeable marginal economic and social benefits of increasing spending in the above areas, it would be appropriate to raise the low tax-to-GDP ratio over the short to medium term. It is also essential that public spending be ... Les réformes du secteur public et le recentrage des dépenses, en partie grâce aux privatisations, ont permis d’alléger l’administration publique au Mexique et de la rendre plus efficace. Les dépenses primaires représentent 18 pour cent du PIB environ en 1999, moins de la moitié de la moyenne de l’OCDE. En même temps des dépenses importantes doivent être engagées pour établir les bases d’une croissance forte et durable à moyen terme. Il y a des carences considérables au niveau des infrastructures de base; et dans des domaines, tels que l’éducation et la santé, il faudra que les ressources budgétaires augmentent régulièrement. Il faut aussi prendre des mesures spécifiques pour combattre la pauvreté. Des ressources fiscales insuffisantes et une forte dépendance à l’égard des recettes pétrolières ont constitué des freins importants au développement de programmes publics essentiels. A cet égard et au vu des avantages marginaux économiques et sociaux considérables qui résulteraient ...

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    Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 288.

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    Date of creation: 02 Mar 2001
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    Handle: RePEc:oec:ecoaaa:288-en
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