A Note on Mexico and U.S. Manufacturing Industries' Long-term Relationship

Daniel Chiquiar and Manuel Ramos Francia

No 2008-08, Working Papers from Banco de México

Abstract: The results in Chiquiar and Ramos-Francia (2005) suggested that the long-run relationship between the US's and Mexico's manufacturing sectors was weakened after China joined the World Trade Organization (WTO). When that paper was made, however, this shock was too recent and, therefore, the analysis was based only on end-of-sample structural break tests. In this note we use updated information to revisit this issue. The results suggest that, by shifting resources towards those sectors where it remained competitive, Mexico's response allowed the effect of China's entry to the WTO on its long-term relationship with the U.S. manufacturing sector to be only temporary.

JEL-codes: E32 F15 F32 (search for similar items in EconPapers)
Date: 2008-07
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (2)

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