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Does The Impact of Trade Liberalisation on Exports, Imports, the Balance of Payments and Growth: the Case of Mexico

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  • Penelope Pacheco-López

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Abstract

The aim of this paper is to disentangle the effects of trade liberalisation during the mid-1980s from the liberalisation involved in the North American Free Trade Agreement (NAFTA) on exports, imports and the balance of payments in Mexico. The main empirical results suggest that the trade reforms during the mid01980s had a significant impact on trade, exports and imports; however, the effects of NAFTA are negligible. Since the mid-1980s, the propensity to import has exceeded the propensity to export and this has worsened the growth rate consistent with balanced trade, and this is a major explanation of the slowdown of Mexico's growth in recent years. NAFTA has not delivered the improved growth performance that was promised by Mexico's political leaders at the time.

Suggested Citation

  • Penelope Pacheco-López, 2004. "Does The Impact of Trade Liberalisation on Exports, Imports, the Balance of Payments and Growth: the Case of Mexico," Studies in Economics 0401, School of Economics, University of Kent.
  • Handle: RePEc:ukc:ukcedp:0401
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Carlo Pietrobelli & Silvia Nenci, 2007. "Does tariff liberalization promote trade? Latin America in the long run (1900-2000)," Working Papers 0704, CREI Università degli Studi Roma Tre, revised 2007.
    2. Lanre Kassim, 2013. "The Impact of Trade Liberalisation on Export Growth and Import Growth in Sub-Saharan Africa," Studies in Economics 1310, School of Economics, University of Kent.
    3. Robert Blecker, 2007. "External Shocks, Structural Change, and Economic Growth in Mexico, 1979-2006," Working Papers wp157, Political Economy Research Institute, University of Massachusetts at Amherst.

    More about this item

    Keywords

    Trade liberalisation; NAFTA; Exports; Imports; Balance of Payments; Mexico;

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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