Economic Policy Reform in Mexico

A Case Study for Developing Countries

1st Edition - January 1, 1981
Author: Leopoldo Solís
Language: English
eBook ISBN:
9 7 8 - 1 - 4 8 3 1 - 5 2 1 1 - 0

Economic Policy Reform in Mexico: A Case Study for Developing Countries is a five-chapter text about political economy that tries to assess the economic developments in Mexico,… Read more

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Economic Policy Reform in Mexico: A Case Study for Developing Countries is a five-chapter text about political economy that tries to assess the economic developments in Mexico, especially the attempt at economic reform in the early 1970s. The first chapter examines the period of Stabilizing Development to provide a framework necessary for judging the environment in which the attempts at economic reform were undertaken. This chapter is a piece of applied economics that tries to assess the too frequent attacks against that phase of economic policy. The following three chapters discuss the economic policy objectives of Echeverria's administration, the attempt at tax reform, and the change in the structure and practices of public spending. The final chapter evaluates the experience and draws some inferences about the nature of decision making in economic policy and the constraints faced by a government that wants to use economic policy as an instrument for the promotion of social welfare. This book will prove useful to economists, historians, and researchers.

Preface

Chapter

1 Stabilizing Development; A sketch of the 1960s

∙ Economic Growth and Price Stability

∙ Import Substitution and the Growth of Manufacturing

∙ Agriculture: The "Green Revolution" Comes to a Standstill

Public Investment in Agriculture

Sources of Agricultural Growth

The effects of Agricultural Stagnation in the Labor Market

∙ The Boom of Financial Intermediation

∙ Taxing or Borrowing?

∙ Employment, Growth, and Income Distribution

Domestic and Foreign Equilibrium

2 Echeverria's Campaign and First Year of Administration

∙ The Setting

The Campaign

Reform and "Keep Talking"

Economic Objectives

The Cabinet

∙ Developments before early 1972

The Attempt to Restore Price and Balance-of-Payments Stability

The First Recession

∙ Measures Necessary for the Realization of the President's Program

The Dollar Starts Floating: A Lost Opportunity for Economic Reform

Alternatives of Economic Policy

The Economic Situation in Early 1972

3 The Attempt at Tax Reform of 1972

∙ The Economic and Political Climate in 1972

The Spending Spree of 1972

Political Babble and Entrepreneurial Attitudes

The Tax Reform Proposal and Its Rejection

4 1973 and Onwards

∙ Stagflation

Inflation Becomes Unmanageable

Stop-Go Policies and the Burden of Deficit Spending

Forcing the Hand of the Private Sector

Reform on the Spending Side

∙ Foreign Indebtedness and Financial Intermediation

Foreign Indebtedness Soars

Changes in the Structure of Financial Intermediation

∙ Assessments

Has the Capacity for Growth Been Impaired?

Orthodox Economic Policies and a Reformminded Government

Political Timing vs· Economic Timing. Are Politicians Short-Run Maximizers?

5 Policy Reform in a Developing, Mixed-Economy System

National Entrepreneurs' organizations

Labor Unions

Political and Bureaucratic Elites

The Middle Class

Foreign Investors

∙ Alternatives

∙ Redistributive Mechanisms

Epilogue

Statistical Appendix

Index

About the Author