Mexico's Economic Growth and the Balance of Payments Constraint: A cointegration analysis
- 1 May 1999
- journal article
- research article
- Published by Informa UK Limited in International Review of Applied Economics
- Vol. 13 (2), 149-159
- https://doi.org/10.1080/026921799101634
Abstract
This paper applies the basic balance-of-payments constraint model (BPCmodel), developed by A.P. Thirlwall, to the analysis of Mexico's economic growth in 1950-96.With the use of unit-root tests and cointegration analysis it estimates the long-run association between the growth of Mexico's real exports and real output in 1950-96, and selected subperiods. The results tend to show significant and positive cointegration between these two variables, thus giving support to the BPC-model as a relevant hypothesis to explain Mexico's long-term economic growth. Moreover, the findings of cointegration tests for selected subperiods suggest that the slowdown in its economic growth since 1982 is associated with an increase in the long-term income elasticity of imports that made more binding the balance-of-payments constraint on the expansion of domestic output.Keywords
This publication has 8 references indexed in Scilit:
- Balance-Of-Payments–Constrained Growth: A Reconsideration of the Evidence for the U.S. EconomyJournal of Post Keynesian Economics, 1997
- Balance-Of-Payments–Constrained Growth Model and Its Implications for the United StatesJournal of Post Keynesian Economics, 1997
- On the Empirics of Balance-Of-Payments–Constrained GrowthJournal of Post Keynesian Economics, 1997
- An explanation of the slowdown in US economic growthApplied Economics Letters, 1995
- Economic Growth and the Balance-of-Payments ConstraintPublished by Springer Science and Business Media LLC ,1994
- Mexico: Stabilization, Reform, and No GrowthBrookings Papers on Economic Activity, 1994
- Static versus dynamic specifications and the Harrod foreign trade multiplierApplied Economics, 1993
- THE BALANCE OF PAYMENTS CONSTRAINT, CAPITAL FLOWS AND GROWTH RATE DIFFERENCES BETWEEN DEVELOPING COUNTRIES *Oxford Economic Papers, 1982