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The aim of this paper is to examine the effect of economic openness on wage dispersion. To this end, using a fixed effects panel model, we evaluate the impact of exports and foreign direct investment (FDI), as well as productivity and education, on wage dispersion in 14 economic subsectors in Mexico during the period 1999-2021. The main findings show that: i) increasing exports tend to diminish wage dispersion; ii) the flow of FDI seems to increase wage dispersion; iii) productivity and the heterogeneity of the productive network are determining factors in the dynamics of average wages. In this context, it is important to implement a variety of industrial and labour policies to effectively absorb the dynamic advantages associated with economic openness, such as the reduction of wage dispersion. [ABSTRACT FROM AUTHOR]

The recent reform of Mexico's energy sector, underway since 2013, is the culmination of several decades of liberalization policies that aimed, in large part, to denationalize Mexico's petroleum industry and open the sector to investment from private foreign firms. In reversing the nationalization of Mexico's oil industry in 1938, this reform has significant implications for the triumph of neoliberal globalization in the Global South, even in a period of rising protectionism in the Global North. Both the United States and Canada played a significant role in promoting the reform of Mexico's energy sector and in structuring the legislative changes that reopened Mexico's hydrocarbon resources to foreign control. Over the past two years, Canadian firms have benefited significantly from new pipeline and oil and gas contracts in Mexico. Taking a legal-geographical approach, this paper examines Canadian involvement in the restructuring of Mexico's oil and gas sector, both spatially (through proximity, interests, and influence in the North American energy market) and legally. The legal component operates through a form of juridical pluralism, in which the institutions of contemporary economic globalization, including the Canadian state, participate in legislative and regulatory changes in the Mexican oil industry. [ABSTRACT FROM AUTHOR]

This paper formulates a static applied general equilibrium model of a small open economy and then calibrates it to the Mexican input–output matrix for 1987. We use the calibrated model to quantify how much of the dramatic rise in the skill premium over the period 1987–1994, following the liberalization of the trade policy in Mexico, can be accounted for by the change in the extensive margin of trade or trade variety. Our numerical experiments show that the increase in the extensive margin of Mexican manufactured trade with the U.S. can account for up to approximately 12 percent of the actual increase in skill premium in Mexico from 1987 to 1994. [ABSTRACT FROM AUTHOR]

The uneven income distribution in Mexico has frequently being subject to both scrutiny and concern. This phenomenon seems to have a spatial counterpart much less explored and increasingly complex. This paper introduces a novel approach to analyse space–time integration of income distribution dynamics in Mexico. We draw on recent extensions in Exploratory Space-Time Data Analysis (ESTDA) anddirectionalstatistics, to investigate spatial dynamics and income movement patterns between Mexican states over 70 years. We use spatial randomization to test directional co-movements in spatially contiguous units as evidence of spatial dependence in income distribution dynamics. Strong evidence of spatial integration of income distribution dynamics is found along the study period. Our results suggest that, in many instances, states do not act independently and we identify a range of integrated movements. The lack of independence itself has important implications for income distributional outcomes as higher mobility will not necessarily imply mixing in the distribution, which is more likely to occur among neighbouring states within a similar income strata. This can be illustrated by the findings of two spatial, yet, contrasting effects: spatial integration in (low) top-down mobility, on the one hand, and negative spatial dependence on the other. While the latter is mostly explained by losses in states and distributional gains of the neighbours with income mixing (rank shifts among neighbouring states) within a group of states, the former phenomena obey a different spatial process where a state and neighbours move in the same direction in the distributional space. Altogether, our findings suggest the presence of slow spatial change in Mexico, mainly due to the presence of heterogeneous, spatially integrated dynamics influencing net change in income distributional outcomes. [ABSTRACT FROM PUBLISHER]

Abstract: Previous studies have found that a tightening of the balance of payments (BP) constraint can explain the slowdown in Mexico's growth after its trade liberalization in the late 1980s. This paper develops a disaggregated model of the BP constraint with two types of exports (manufactures and primary commodities) and two types of imports (intermediate and final goods). Econometric estimates (including tests for structural breaks) show that the BP-equilibrium growth rate did not fall, but instead rose in the post-liberalization period, so this model cannot account for the country's growth slowdown. Instead, the analysis points to the need to consider the real exchange rate as well as internal obstacles and policies. [Copyright &y& Elsevier]

ABSTRACT This paper empirically analyzes regional disparity in terms of convergence of per capita income across Mexican states for the period 1970-2005. In particular, this study extends the conventional cross-sectional conditional β-convergence analysis of the existing literatures on Mexico to panel data analysis, and focuses on whether the convergence performance varies between the pre- and post-economic liberalization periods. When unobservable state-specific effects are controlled by the panel data technique, the estimated coefficients show significant conditional β-convergence, even after economic liberalization, but with a lower speed than before economic liberalization. [ABSTRACT FROM AUTHOR]

Summary: The paper analyzes the impacts of cash flow from multiple investments in real and financial sectors on the new fixed investment spending of real sector firms. The empirical results based on the Euler equation approach and semi-annual firm level data from two major emerging markets, Mexico and Turkey, suggest that profits and rates of returns from fixed and financial assets have differential effects on fixed investment spending of real sector firms. Accordingly, increasing availability and accessibility of alternative investment opportunities in financial markets can become instrumental in channeling real sector savings to short-term financial investments instead of long-term fixed capital formation and thus lead to deindustrialization. [Copyright &y& Elsevier]

Since the liberalization of its trade in the mid-1980s, Mexico has pursued an aggressive globalization strategy, which today makes it the country with the most free trade agreements in the world. This liberalization strategy has also included the banking sector, particularly since 1997, when all restrictions to the entry of foreign banks were removed. The history of the banking sector in Mexico includes episodes of nationalization in 1982, privatization in 1992, and near-complete failure in 1995. Since then, however, the Mexican government has undertaken a series of bold reforms that have contributed to the modernization of its financial system. This paper documents the evolution of Mexico's banking sector starting from its nationalization in 1982 and culminating with the increased entry of foreign banks in recent years that has driven the recovery of bank credit to the private sector. [ABSTRACT FROM AUTHOR]