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 Mexico’s Development in Comparative Perspective Historical experience of colonialism and neo-colonialism
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| tarix | 08.08.2018 | | ölçüsü | 2,57 Mb. | | #61466 |
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Historical experience of colonialism and neo-colonialism- 1st wave of imperial expansion (15th-18th C)
- Colonized by Spain
- Cortes 1519
- Spanish
- Controlled land
- Extracted silver
Mexico’s Development in Comparative Perspective Independence from Spain 1821
Mexico’s Development in Comparative Perspective “The Porfiriato”- Porfiro Diaz (1876-1910)
- Foreign investment
- Infrastructure development
- Benefitted mainly wealthy, upper class
Mexico’s Development in Comparative Perspective “The Porfiriato”Neo-colonialism- De-nationalization
- By 1911, US companies owned
- 40% of land
- 50% of oil industry
- Controlling interests in main export sectors
- Foreign repatriation of profits
Mexico’s Development in Comparative Perspective “The Porfiriato”“Dependence”- “One-way” trade partner concentration
- Commodity concentration
- Growing inequality
The Struggle to Overcome Dependence
Constitution of 1917
Two different sources of ideas have informed development strategy since “The Porfiriato” Two different sources of ideas have informed development strategy since “The Porfiriato”
The Struggle to Overcome Dependence PRI: Institutional Revolutionary Party 1929-- Cardenas (1934-1940)
- Pursued statist strategy
- Land redistribution—ejidos
- Nationalized oil industry—1938
- Established state-run oil company—PEMEX
- video clip
Pemex—National oil company of Mexico Symbol of Statist Strategy
Statist strategy
ISI: Import substituting industrialization ISI: Import substituting industrialization - Substitute local production for imports
- Develop the capacity to produce goods locally that were imported from abroad in the past
The Struggle to Overcome Dependency: Statist strategy Domestic market supplied by- State-owned enterprises
- Capital intensive industries
- 1940-1970, ~40% of fixed capital investment from government
- Foreign direct investment
- Local private enterprises
State supported private investors State supported private investors
State supported private investors State supported private investors- Protected local market for new industries
- Tariff barriers
- Licensing requirements
- Why might licensing be considered bad policy?
- Neo-liberal critique of ISI
State supported private investors State supported private investors- Protected local market for new industries
- Tariff barriers
- Licensing requirements
- Why might licensing be considered bad policy?
- Neo-liberal critique of ISI : “rent-seeking”
Growing dependence on oil exports (80% by 1982) Growing dependence on oil exports (80% by 1982)Growing foreign debt (86 billion US dollars by 1982)Price volatility: price per barrel of oil 1978: $13 1981: $33 1982: $26 mid-1980s: $12 2007: >$60 2008: <$100
Two types of development strategy since “The Porfiriato” Two types of development strategy since “The Porfiriato”- Statist
- ISI: Import substituting industrialization
- Liberal
- EOI: export-oriented industrialization
The Struggle to Overcome Dependency: Neo-liberal Strategy Neo-Liberal strategy- Privatize state-owned enterprises
- Except PEMEX
EOI: export-oriented industrialization EOI: export-oriented industrialization What is it? Why might neo-liberals prefer this strategy?
EOI: export-oriented industrialization EOI: export-oriented industrialization - Reduced tariff barriers to allow imports of machinery and inputs to make products for export
- Tax breaks for factories that export their products
- Subsidized credit for factories that export
The Struggle to Overcome Dependency: Neo-liberal Strategy EOI: export-oriented industrialization - Joined NAFTA 1992
- Shift to comparative advantage
- Fruits and vegetables
- More labor-intensive products
- In export-processing plants (maquiladoras)
- Consumer electronics
- Garments, etc.
The Struggle to Overcome Dependency NAFTA—free trade- Hurt Mexican agriculture in 1990s
- US
- corn 7 tons/hectare
- Mexico
- corn <2 tons/hectare
- Chiapas
- corn .5 tons/hectare
- Subsidies to US farmers
- > $15 billion, 2010
- Corn—biggest recipient
“As the North American Free Trade Agreement nears its 10th anniversary, a study from the Carnegie Endowment for International Peace concludes that the pact failed to generate substantial job growth in Mexico, hurt hundreds of thousands of subsistence farmers there and had ''minuscule'' net effects on jobs in the United States. “As the North American Free Trade Agreement nears its 10th anniversary, a study from the Carnegie Endowment for International Peace concludes that the pact failed to generate substantial job growth in Mexico, hurt hundreds of thousands of subsistence farmers there and had ''minuscule'' net effects on jobs in the United States.
“The world’s wealthiest nations give more than $300 billion of subsidies to their farmers every year, more than the gross national product of sub-Saharan Africa.” “The world’s wealthiest nations give more than $300 billion of subsidies to their farmers every year, more than the gross national product of sub-Saharan Africa.”
“Coldplay came to meet with a corn growing cooperative and discuss its belief that opening agricultural markets to free trade drives small farmers out of business. “Coldplay came to meet with a corn growing cooperative and discuss its belief that opening agricultural markets to free trade drives small farmers out of business.“Mexican corn producers struggle to compete with imports from expansive, government-subsidized U.S. farms
Neither statist nor liberal strategies fully overcome dependency Neither statist nor liberal strategies fully overcome dependency
“China’s Eating Mexico’s Lunch” “China’s Eating Mexico’s Lunch”
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