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NAFTA and productivity convergence between Mexico and the US

Tadashi Ito ()
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Tadashi Ito: IUHEI, The Graduate Institute of International Studies, Geneva

No 26-2007, IHEID Working Papers from Economics Section, The Graduate Institute of International Studies

Abstract: This paper studies whether NAFTA contributed to the productivity convergence between Mexico and the US. Using data from the manufacturing sector and introducing a number of refinements in the computation of the total factor productivity and estimation methods, it shows that NAFTA is associated with a higher speed of convergence of productivity levels than the previous literature found. The paper also finds that under NAFTA the industries which have smaller productivity gap experienced higher speed of convergence (catch-up) than the industries which have larger productivity gap.

Keywords: NAFTA; Productivity (search for similar items in EconPapers)
JEL-codes: F15 F43 (search for similar items in EconPapers)
Pages: 28
Date: 2007-10-11, Revised 2007-11-27
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