Volume 43, Number 170,
July-September 2012
Economic Growth and Industrial Policy in Mexico
Cuauhtémoc Calderón and Isaac Sánchez
SLOW GROWTH, (UN) EMPLOYMENT AND INSUFFICIENT GROWTH IN MANUFACTURING ( ...continuation )

Figure 2. Evolution of Income Per Capita in Mexico, 1950-2010 (2010=100)
Source: based on data supplied by The Conference Board

From a long term perspective, the output generated by the Mexican economy is clearly undergoing a process of stagnation or low growth rate. It is worth noting significant rises in the years 1996, 1997, 1998, 2000 and 2006 although these are insufficient, given that they occur alongside critical downturns, particularly in 1995 and 2009. Output per person has stagnated for almost thirty years, particularly when compared to the previous thirty years.

According to Hausmann et al. (2005) the Mexican economy experiences rapid growth when the gdp per capita exceeds at least 3% during a ten year period. When an economy does not follow this empirical rule, it may be considered to be in a period of slow growth.

An uninterrupted continuum of poor or negative growth is what here is interpreted as slow economic growth. This is precisely what has been happening to the Mexican economy in previous years. Particularly relevant is the period 1994-2010, as with the North American Free Trade Agreement (nafta) in operation during these years, an economic model favoring macroeconomic openness and stability was consolidated, in detriment to employment and economic growth, variables which opinion views as safeguarding, though in practice leads to depression.

The low economic growth rates prevalent in the country have led to the national economy to fall behind those of the rest of the world, particularly the u.s.a. Mexico’s principal trade partner. Figures from Moreno-Brid and Ros (2009:261) indicate that while Mexico’s gdp per capita represented 35.6% of the u.s.a.’s, it represented 24.6% in 2003, 25% in 2005 and 22% in 2009. The increasing economic divergence between the two countries is notorious, Mexico’s slow economic growth being without a doubt the reason behind this.

In line with that discussed in the first part, this article highlights the performance of various sectors in terms of economic activity, particularly manufacturing. The evolution of sectorial economic growth is shown in Figure 3. The data reveals that there is increasingly less participation in gdp total in the agricultural sector during the period 1982-2009, from 6.3% in 1982 to 5.4% in 2009, whereas in the industrial sector (including manufacturing, construction, electricity, gas and water) there is a drop from 24.9% to 23.2%, a decline of nearly two percentage points. Manufacturing represented 17% of gdp in 1982 and 16% in 2009. The service sector increased its participation rising from 62.7% to 65.9%.

Figure 3. Annual Growth per Sector of Economic Activity
Source: Based on data from the Banco de Información Económica supplied by inegi

Published in Mexico, 2012-2017 © D.R. Universidad Nacional Autónoma de México (UNAM).
PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 48, Number 191, October-December 2017 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
CP 04510, México, D.F. Tel (52 55) 56 23 01 05 and (52 55) 56 24 23 39, fax (52 55) 56 23 00 97, www.probdes.iiec.unam.mx, revprode@unam.mx. Journal Editor: Alicia Girón González. Reservation of rights to exclusive use of the title: 04-2012-070613560300-203, ISSN: pending. Person responsible for the latest update of this issue: Minerva García, Circuito Maestro Mario de la Cueva s/n, Ciudad Universitaria, Coyoacán, CP 04510, México D.F., latest update: Nov 13th, 2017.
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