IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/57573.html

An unfinished business: Economic liberalization and structural change in Mexico

Author

Listed:
  • Padilla-Pérez, Ramón
  • Villarreal, Francisco G.

Abstract

Mexico, as other Latin American countries, undertook far-reaching economic reforms in the 1980s and 1990s in a wide array of areas: trade and industrial policy, foreign investment and capital account, privatization of public enterprises and deregulation of economic activities, among others. As a result of the new economic model, the Mexican economy experienced outstanding export growth, successful insertion into international dynamic markets and shift towards medium and high-technology industries. Yet productivity growth has been insufficient, leading to low and volatile economic growth. This paper examines the dynamics of productivity growth and in particular analyzes whether inter- and intra-industry dynamics can account for sluggish productivity growth. It makes use of a shift-share analysis, taking advantage of a recently published industry-level database developed by the Mexican National Statistics Office as part of the LA-KLEMS project. The paper shows that Mexico has experienced an unfinished structural change, where productivity growth within sectors has been insufficient to close the gap with its main trading partner, the United States. Moreover, despite a significant reallocation of hours worked across industries, its aggregate impact has been hampered by the fact that flows have been from industrial sectors with high labor productivity growth towards sectors with lower, or contracting, productivity growth.

Suggested Citation

  • Padilla-Pérez, Ramón & Villarreal, Francisco G., 2014. "An unfinished business: Economic liberalization and structural change in Mexico," MPRA Paper 57573, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:57573
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/57573/1/MPRA_paper_57573.pdf
    File Function: original version
    Download Restriction: no
    File URL: https://mpra.ub.uni-muenchen.de/62947/1/MPRA_paper_62947.pdf
    File Function: revised version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Karl Whelan, 2000. "A guide to the use of chain aggregated NIPA data," Finance and Economics Discussion Series 2000-35, Board of Governors of the Federal Reserve System (U.S.).
    2. Hofman, André A. & Aravena, Claudio, 2014. "Crecimiento económico y productividad en América Latina: Una perspectiva por industria, según la base de datos LA-KLEMS," Macroeconomía del Desarrollo 36949, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    3. Maudos, Joaqui­n & Pastor, José Manuel & Serrano, Lorenzo, 2008. "Explaining the US-EU productivity growth gap: Structural change vs. intra-sectoral effect," Economics Letters, Elsevier, vol. 100(2), pages 311-313, August.
    4. Justin Yifu Lin, 2012. "New Structural Economics : A Framework for Rethinking Development and Policy," World Bank Publications - Books, The World Bank Group, number 2232, April.
    5. Sanjaya Lall, 2000. "The Technological Structure and Performance of Developing Country Manufactured Exports, 1985-98," Oxford Development Studies, Taylor & Francis Journals, vol. 28(3), pages 337-369.
    6. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    7. Fernández de Guevara, Juan & Hofman, André A. & Aravena, Claudio & Mas, Matilde, 2014. "Structural change in four Latin American countries: An international perspective," Macroeconomía del Desarrollo 36851, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    8. Abramovitz, Moses, 1986. "Catching Up, Forging Ahead, and Falling Behind," The Journal of Economic History, Cambridge University Press, vol. 46(2), pages 385-406, June.
    9. Wolfgang Keller, 2004. "International Technology Diffusion," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 752-782, September.
    10. Moreno-Brid, Juan Carlos & Ros, Jaime, 2009. "Development and Growth in the Mexican Economy: An Historical Perspective," OUP Catalogue, Oxford University Press, number 9780195371161.
    11. Veblen, Thorstein, 1915. "Imperial Germany and The Industrial Revolution," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1915.
    12. Hausmann, Ricardo & Rodrik, Dani, 2003. "Economic development as self-discovery," Journal of Development Economics, Elsevier, vol. 72(2), pages 603-633, December.
    13. Timothy J. Kehoe & Kim J. Ruhl, 2010. "Why Have Economic Reforms in Mexico Not Generated Growth?," Journal of Economic Literature, American Economic Association, vol. 48(4), pages 1005-1027, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Padilla-Pérez, Ramón & Villarreal, Francisco G., 2017. "Structural change and productivity growth in Mexico, 1990–2014," Structural Change and Economic Dynamics, Elsevier, vol. 41(C), pages 53-63.
    2. Costantini, Valeria & Liberati, Paolo, 2014. "Technology transfer, institutions and development," Technological Forecasting and Social Change, Elsevier, vol. 88(C), pages 26-48.
    3. Giovanni Dosi & Andrea Roventini & Emmanuele Russo, 2020. "Public Policies And The Art Of Catching Up," Working Papers hal-03242369, HAL.
    4. Giovanni Dosi & Andrea Roventini & Emanuele Russo, 2021. "Public policies and the art of catching up: matching the historical evidence with a multicountry agent-based model [Catching up, forging ahead, and falling behind]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 30(4), pages 1011-1036.
    5. Jan Fagerberg & Maryann Feldman & Martin Srholec, 2011. "Technological Dynamics and Social Capability: Comparing U.S. States and European Nations," Working Papers on Innovation Studies 20111114, Centre for Technology, Innovation and Culture, University of Oslo.
    6. Fagerberg, Jan & Srholec, Martin & Verspagen, Bart, 2010. "Innovation and Economic Development," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 2, chapter 0, pages 833-872, Elsevier.
    7. Martins IYOBOYI & Abdrelrasaq NA-ALLAH, 2014. "Innovation and economic growth: evidence from Nigeria," EuroEconomica, Danubius University of Galati, issue 1(33), pages 43-54, May.
    8. Lectard, Pauline & Rougier, Eric, 2018. "Can Developing Countries Gain from Defying Comparative Advantage? Distance to Comparative Advantage, Export Diversification and Sophistication, and the Dynamics of Specialization," World Development, Elsevier, vol. 102(C), pages 90-110.
    9. repec:spo:wpmain:info:hdl:2441/3s3jn8tt5h9mab7fo128gecbhj is not listed on IDEAS
    10. Giovanni Dosi & Federico Riccio & Maria Enrica Virgillito, 2022. "Specialize or diversify? And in What? Trade composition, quality of specialization, and persistent growth [Catching up, forging ahead, and falling behind]," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 31(2), pages 301-337.
    11. Fulvio Castellacci, 2007. "Evolutionary And New Growth Theories. Are They Converging?," Journal of Economic Surveys, Wiley Blackwell, vol. 21(3), pages 585-627, July.
    12. Souzanchi Kashani, Ebrahim & Radosevic, Slavo & Kiamehr, Mehdi & Gholizadeh, Hossein, 2022. "The intellectual evolution of the technological catch-up literature: Bibliometric analysis," Research Policy, Elsevier, vol. 51(7).
    13. T. Gries & R. Grundmann & I. Palnau & M. Redlin, 2018. "Technology diffusion, international integration and participation in developing economies - a review of major concepts and findings," International Economics and Economic Policy, Springer, vol. 15(1), pages 215-253, January.
    14. Andreoni, Antonio & Chang, Ha-Joon, 2019. "The political economy of industrial policy: Structural interdependencies, policy alignment and conflict management," Structural Change and Economic Dynamics, Elsevier, vol. 48(C), pages 136-150.
    15. Francesco Bogliacino & Mario Pianta, 2016. "The Pavitt Taxonomy, revisited: patterns of innovation in manufacturing and services," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 33(2), pages 153-180, August.
    16. Robert Z. Lawrence & Lawrence Edward, 2010. "Do Developed and Developing Countries Compete Head to Head in High Tech?," Working Paper Series WP10-8, Peterson Institute for International Economics.
    17. Meschi, Elena & Taymaz, Erol & Vivarelli, Marco, 2011. "Trade, technology and skills: Evidence from Turkish microdata," Labour Economics, Elsevier, vol. 18(S1), pages 60-70.
    18. Miketa, Asami & Mulder, Peter, 2005. "Energy productivity across developed and developing countries in 10 manufacturing sectors: Patterns of growth and convergence," Energy Economics, Elsevier, vol. 27(3), pages 429-453, May.
    19. Andre Nassif & Carmem Aparecida Feijo & Eliane Araújo, 2016. "Structural change, catching up and falling behind in the BRICS: A comparative analysis based on trade pattern and Thirlwall’s Law," PSL Quarterly Review, Economia civile, vol. 69(279), pages 373-421.
    20. Cavallaro, Eleonora & Mulino, Marcella, 2008. "Technological diffusion and dynamic gains from trade," MPRA Paper 13793, University Library of Munich, Germany.
    21. Ajay Thutupalli & Michiko Iizuka, 2016. "Catching-up in agricultural innovation: the case of Bacillus thuringiensis cotton in India," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 25(6), pages 923-940.

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • N16 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Latin America; Caribbean
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:pra:mprapa:57573. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    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.