Winners and Losers of Regional Growth in Mexico and their Dynamics

Developing countries, such as Mexico, where in-depth processes of economic liberalization have taken place over the last few decades, offer fertile ground for studies of regional disparities. This paper analyzes convergence among regions and the mobility among different categories of income and grow...

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Bibliographic Details
Published in:Investigación económica 2007-01, Vol.66 (259), p.43-62
Main Author: Rodríguez-Oreggia, Eduardo
Format: Article
Language:English
Subjects:
Economics
Online Access:Get full text
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Summary:Developing countries, such as Mexico, where in-depth processes of economic liberalization have taken place over the last few decades, offer fertile ground for studies of regional disparities. This paper analyzes convergence among regions and the mobility among different categories of income and growth, as well as the factors affecting such mobility. In doing so, we present a method based on the Markov chains to analyze mobility and then a multinomial logit for factors affecting such mobility. The evidence shows that northern states, bordering the United States, moved from a condition of falling-behind prior to liberalization to that of winners thereafter, while southern states went from catching-up to a condition of losers. Mobility is low and richer states tend to remain rich, while poorer states remain poor. Endowments of human and public capital play an important role in defining such patterns.
ISSN:0185-1667