Agglomeration economies, growth and the new economic geography in Mexico

Díaz-Bautista, Alejandro

doi:10.18381/eq.v1i2.174

Cited by 7 publications

(5 citation statements)

References 31 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…These articles emphasize transportation costs as the crucial factor that incentivize firms to locate in the north while existent agglomeration reinforces the pre-trade-opening pattern. Results in Mendoza-Cota and Pérez-Cruz (2007), and Diaz-Bautista (2005) 6 are consistent with this approach.…”

Section: 3empirical Studies On Industrial Location and Agglomeration Economies For Mexicosupporting

confidence: 71%

Determinants of Regional Growth by Manufacturing Sector in Mexico, 1998-2008

Pereira

Soloaga

2013

SSRN Journal

View full text Add to dashboard Cite

This article presents an empirical analysis aimed at identifying the determinants of regional growth in Mexico by manufacturing sector in the period 1988-2008. In the framework of agglomeration economies it argues that the main factor behind Mexico's long-term regional industrial growth is Jacobs externalities (urbanization economies), and that wages are the main short-term factor behind this growth. There is heterogeneity in the determinants of regional growth according to technological intensity. Lowtechnology sectors appear to be more sensitive to initial wages and exhibit Jacobs externalities, while higher technology sectors show Porter economies (competition/specialization). Controlling for market conditions, agglomeration economies, and initial conditions, the south, the center and the Gulf of Mexico have a relative disadvantage for growth in medium-high-technology sectors. Moreover, only one out of the 58 Metropolitan Areas (MAs) studied shows a relative advantage for growth in this kind of industry. Relative advantage for low-technology sectors appears to be related to transportation and service infrastructure, while for high-technology sectors the main determinant is human capital.

show abstract

Section: 3empirical Studies On Industrial Location and Agglomeration Economies For Mexicosupporting

confidence: 71%

Determinants of Regional Growth by Manufacturing Sector in Mexico, 1998-2008

Pereira

Soloaga

2013

SSRN Journal

View full text Add to dashboard Cite

show abstract

“…In comparison to findings from similar studies in the literature, our results are more ambiguous in the sense that it depends on the initial degree of concentration of each industry. The cases of Mexico or Eastern European countries clearly indicate a tendency of firms to move toward border areas with the USA or the EU, respectively, as mentioned in Hanson (1998), Díaz-Bautista (2005 and Niebuhr and Stiller (2002). Such case studies examine the experience of a smaller economy integrating into bigger markets.…”

Section: Conclusion and Policy Implicationsmentioning

confidence: 78%

Will manufacturing investors go to border zones? The case of central Thailand

Bui

Preechametta

2019

IJOEM

View full text Add to dashboard Cite

Purpose The purpose of this paper is to examine effects of regional economic integration on the concentration of manufacturing firms in provinces of Thailand on the border with Cambodia. It aims to clarify the interactions between dispersion and agglomeration forces within a firm’s location choice in the presence of economic integration and thereby to explain the feasibility of the border SEZs. Design/methodology/approach The theory of industrial clustering and New Economic Geography provides a theoretical framework to understand the locations of economic activities when regional economies are integrated. This paper employs provincial level data to calculate industry location quotients across a 10-year period from 2007 to 2017 in central Thailand and uses firm-level data from industrial censuses in 2006 and 2011 to estimate logit models for two border provinces with Cambodia and three eastern seaboard provinces. Two base models and extended models are tested to explain the persistent agglomeration of Thai firms in each manufacturing industry. Findings The authors found a positive correlation between the agglomeration level in 2006 and the choice of firms toward the border provinces in 2011. The disaggregated analysis shows that depending on the initial level of concentration in each industry, there can be agglomeration or dispersion effects. The advantage of low trade costs and labor costs of unskilled migrant workers are not significant factors attracting firms to the border. Firms in industries with increasing returns are more likely to stay in the hub. Practical implications The disaggregated analysis by industry provides very important implications for SEZ policy interventions. The important role of agglomeration economies limits the extent to which such policies can be successful. It would be an enormous challenge for policy makers to initiate forces which are strong enough to induce firms to relocate away from areas with high agglomerations. Policy interventions with attractive incentives should be very selective to industries already have a certain degree of concentration in the provinces so as to reinforce the agglomeration effects. Originality/value The research extends the empirical literature on SEZs by offering a unique case study of an emerging economy with a strong market foundation rather than a transitional or developed economy. It is also different from other research on SEZs when taking into account the effects of regional integration on border SEZ formation and firms’ location choices. In addition, this study employs firm-level data rather than provincial data to bring empirical insights and fill in the knowledge gap on agglomeration economies in Thailand with the presence of regional economic integration.

show abstract

“…Much research in the 1990s and early 2000s deals with the question of regional convergence (e.g. Borraz & López-Córdova, 2007;Calderon & Tykhonenko, 2006;Chiquiar, 2005;Díaz Bautista, 2003Díaz Bautista & Mendoza, 2004;Esquivel, 1999;Gamboa & Messmacher, 2002;Rodriguez-Oreggia, 2002Sanchez-Reaza & Rodriguez Pose, 2002) and the effects of trade liberalization and North American integration on interregional inequality (Aroca, Bosch, & Maloney, 2005;Chamboux-Leroux, 2001;Corona Jímenez, 2003;Decuir-Viruez, 2003;Díaz Bautista, 2005;Dussel Peters, 2003;Garza, 2003;Jordaan & Sánchez-Reaza, 2004;Rodríguez-Pose & Sánchez-Reaza, 2003;Sanchez-Reaza & Jordaan, 2002). With few exceptions, these studies find that while there was convergence across Mexican states from 1940 to 1980, there has been no further convergence since the beginning of the 1990s.…”

Section: The Evolution Of Regional Disparitiesmentioning

confidence: 99%

Regional disparities in Mexico and the spatially cumulative effects of national development and economic cycles, 1940–2013

Nieto

2021

Regional Science Policy & Practice

View full text Add to dashboard Cite

Mexico's regional disparities and national economic performance in the 1940-2013 period is measured to test the question of whether regional imbalances expand or contract with the national economy's growth or decline, and also the question of disparities increasing or decreasing depending on the country's stage of development. Given the recurring waves of recession and stagnation in Mexico in recent decades, determining the cyclicality of disparities is of particular interest for regional policy-making. In the long run, regional inequalities exhibit a U-shape. Results also indicate that while the decrease in disparities during the most severe economic downturns during the liberalized period is striking, there is no strong statistical support for the pro-cyclical evolution of regional inequalities.

show abstract

Agglomeration economies, growth and the new economic geography in Mexico

Cited by 7 publications

References 31 publications

Determinants of Regional Growth by Manufacturing Sector in Mexico, 1998-2008

Determinants of Regional Growth by Manufacturing Sector in Mexico, 1998-2008

Will manufacturing investors go to border zones? The case of central Thailand

Regional disparities in Mexico and the spatially cumulative effects of national development and economic cycles, 1940–2013

Contact Info

Product

Resources

About