Work

Trade liberalization and the dimensions of efficiency change in Mexican manufacturing industries

Year: 1995

Type: article

Abstract: Did Mexico's recent trade liberalization generate productivity gains? We find that average costs fell in most industries, with tradeable goods producers registering the largest reductions. Among importables, these cost reductions trace partly to improvements in relative productivity. Among exportables, they are due to favorable changes in relative prices, probably because imported intermediate goods became cheaper. Gains due to scale economy exploitation were minor and were not correlated with increases in foreign competition. Hence the results cast some doubt on simulation studies of trade liberalization that stress scale effects as a major source of efficiency gain.

Source: Journal of International Economics

DOI: 10.1016/0022-1996(94)01363-w

Authors: James R. Tybout, M.Daniel Westbrook

Institution: Georgetown University

Language: English

Topic: Global trade and economics

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: hybrid

Estimated APC paid: $4,300