The European Journal of Comparative Economics

ISSN: 1824-2979

EJCE Year: 2016, December. Volume: 13 - Issue: 2

Could Mexico become the new 'China'? Policy drivers of competitiveness and productivity

by Sean M. Dougherty ; Octavio R. Escobar

Start page: 169 - End page: 198

Keywords: Productivity; microdata; sub-national policy analysis; informality; allocative efficiency

Jel code: E26; L25; O17; O43; O54

DOI:

Abstract:

Over the last decade, Mexico's unit labour costs decreased relative to other emerging markets', especially compared to China's. This decrease boosted Mexico's trade competitiveness, particularly in the manufacturing sector. However, Mexico's increasing competitiveness masks one of the country's fundamental concerns, which is the absence of productivity improvements. The aim of this paper is two-fold: first, we examine the evolution of total factor productivity in Mexico's manufacturing sector, as compared to China's. Firm-level data is employed to analyse the distribution and characteristics of productivity across Mexico's regions. Second, using regional data for the period 2005-2012, we study the policy impediments behind sluggish productivity improvements, particularly to determine how labour informality may have contributed. The study takes advantage of Mexico's heterogeneity across regions in terms of productivity, market regulation, financial constraints and firm size to identify economic policies that can help to boost productivity in the future.

View this article (PDF)

In case of problems please write an e-mail to secretariat.ejce@liuc.it

Publisher perpetually authorizes participants in the LOCKSS system to archive and restore EJCE articles through the LOCKSS System for the benefit of all LOCKSS System participants. EJCE is registered as OAI-PMH data provider. OAI - Records check.
EJCE, 2018-    : Registro stampa Trib. Busto Arsizio n. 7/18 del 13.07.2018; Direttore responsabile: Piero Cavaleri, Università Carlo Cattaneo - LIUC c.so Matteotti 22 20153 Castellanza VA
EJCE, 2004-2017: Supplemento a LIUC Papers, Registro stampa Trib. Busto Arsizio n. 11/93 del 11.06.1993; Direttore responsabile: Piero Cavaleri, Università Carlo Cattaneo - LIUC c.so Matteotti 22 20153 Castellanza VA