Regional disparities in per capita income in Mexico and the role of the manufacturing industry

Penélope Pacheco-López and Anthony P. Thirlwall

Chapter 14 in Economic Development, Economic Growth and Income Distribution, 2025, pp 283-304 from Edward Elgar Publishing

Abstract: This chapter shows that there has been a steady increase in regional inequality since the early 1990s; that is, there has been divergence. Divergence post-1985 seems to be the result of the Northern states forging ahead as a result of trade liberalisation and NAFTA (the North American Free Trade Agreement). The chapter shows that divergence has been the result of differential manufacturing output growth across regions for 2003–17. To promote convergence, Mexico needs a clear industrial strategy especially towards the southern states. Among the policies to consider, the chapter discusses fiscal incentives, industrial clusters, supporting projects through regional development banks, and export processing zones.

Keywords: Regional disparities; NAFTA; Industrial policy; Mexico; Regional policies (search for similar items in EconPapers)
Date: 2025
ISBN: 9781803929903
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