Employment, wages and economic development in Mexico and the United States, 1965-2015impact of industry and the effects of Nafta

  1. Maria-Carmen Guisan 1
  2. Eva Aguayo 1
  1. 1 Universidade de Santiago de Compostela
    info

    Universidade de Santiago de Compostela

    Santiago de Compostela, España

    ROR https://ror.org/030eybx10

Revista:
Applied econometrics and international development

ISSN: 1578-4487

Ano de publicación: 2017

Volume: 17

Número: 2

Páxinas: 75-86

Tipo: Artigo

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Outras publicacións en: Applied econometrics and international development

Resumo

We present a comparison economic development, productivity, wages and employment in Mexico and the United States, for a period of 50 years ( 1965-2015). Accordingly to Kaldor´s contributions and the empirical evidence we think that it is very important, for to improve industrial development. Mexico experienced an average increase, of industrial real value-added per capita, around 15 USD per year (at constant prices of year 2000) both before NAFTA (period 1964-1993) and after NAFTA (for the period 1994-2012). The U.S. experienced higher increases: 75 USD per year in the first period and 39 per year in the second one. We estimate two macro-econometric equations, for both countries, showing the positive impact of industry on non industrial production and employment. Our conclusion, on the evolution of Mexico after NAFTA. is that it had some positive effects but not enough to get an important and sustained increase of industry, income per capita and wages in this country. Regarding the U.S. NAFTA has had also some positive effects, and the economy has evolved with important and sustained increase of economic development, income per capita and wages, both before and after NAFTA. Our recommendation is to increase cooperation between both countries in order to foster economic development, increasing industrial development

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