The Shift in the Market-State Balance and the Quest for Export-Led Growth

Juan Carlos Moreno-Brid and Jaime Ros

in Development and Growth in the Mexican Economy

Published in print July 2009 | ISBN: 9780195371161
Published online May 2009 | e-ISBN: 9780199870608 | DOI:
 The Shift in the Market-State Balance and the Quest for Export-Led Growth

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Chapter 8 evaluates the overall impact of the radical macroeconomic reform processes—launched since the 1980s—on Mexico's quest for high and sustained economic growth. Attention focuses on identifying the macroeconomic reform's limitations and strengths. It examines the effects of privatization on economic efficiency and argues why certain regulatory deficiencies resulted in an undesirable concentration of ownership in some of the privatized areas. It looks too at the effects of trade liberalization on trade flows and pattern of specialization, and at the results of the liberalization of the land market. On this matter it shows that, although there have been some benefits, the overall performance of agriculture and, in particular, peasant agriculture are disappointing. It also argues that the financial boom and bust cycle that led to the banking crisis of 1994–1995 was partly a consequence of financial deregulation and capital market liberalization. It concludes by pointing out key weaknesses of the contemporary Mexican state, standing out among them the fragility of its fiscal structure and heavy dependence on volatile and declining oil incomes and its inability to carry out anticyclical macroeconomic policies.

Keywords: fiscal fragility; trade and financial liberalization; export-led growth; financial crisis; balance of payments constraint; oil revenues

Chapter.  10161 words.  Illustrated.

Subjects: Economic History

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