The implications of trade openness for regional inequality in Mexico Public Deposited

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  • March 22, 2019
  • González Rivas, Marcela
    • Affiliation: College of Arts and Sciences, Department of City and Regional Planning
  • This dissertation sheds light on the debate about the effect of trade openness on regional inequality (income inequality across states), by exploring the mechanisms through which this relationship has operated in Mexico. Specifically, I analyze the extent to which key state endowments - income, infrastructure, human capital - determine the impact that trade openness has on states' economic performance. Integrating existing competing hypotheses from the literature into a theoretical framework based on endogenous growth theory, I test these hypotheses in three ways. First, I use a state-level data set I constructed covering the period of 1940-2000 in Mexico, a period that ensures variation in levels of both trade openness and regional inequality. Second, I analyze data at the economic sector level, for the same period, to uncover dynamics specific to certain economic sectors that are regionally concentrated in Mexico. Finally, I study in-depth the experience of three states, with regard to their economic performance in the context of changing trade policy. My research has important implications for three bodies of literature. First, it will contribute to the literature on regional inequality and regional convergence, by testing various hypotheses against one another and providing a more detailed understanding of the mechanisms though which trade affects economic performance at the regional level. Second, it will advance the broad literature on the impact of trade openness on developing countries. Many studies have looked at the relationship between trade and economic development at the cross-national level and the effect of trade reform on different socioeconomic groups within countries. There has, however, been relatively little analysis of how trade reform affects regional inequality, and this study contributes to fill that gap. Finally, it will contribute indirectly to bodies of work that look at the relationship between development and levels of infrastructure and human capital. Like the literature on trade, these literatures have largely focused on cross-national statistical work.
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  • In Copyright
  • Goldstein, Harvey A.
Degree granting institution
  • University of North Carolina at Chapel Hill
  • Open access

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