A Gender Perspective on Mexico's Economic Growth

Abstract

Among the Latin American countries, the Mexican economy has shown since the late 1990's one of the lowest rates of economic growth. This is perplexing, because of the persistency of the stagnation tendencies, and because of the rapid growth shown by its exports, especially to the US, that reached $370 billion in 2018. The poor economic performance has had adverse consequences in terms of unemployment, emigration, social conflict, and especially in terms of the losses of female and male youth employment. This paper seeks to explain the causes of Mexico's economic stagnation. The methodology consists of the estimation of cointegration equations that express per capita economic growth as a function of the growth of labor productivity, plus the growth of the female and male employment to population ratios. Additional equations were estimated to identify the variables that explain the growth of productivity and of employment ratios and to estimate the role of deindustrialization in economic stagnation. An analysis was made of the role of female employment on the mobilization of domestic savings, on the determination of the deficit in the trade account, and on the constraint exerted by the balance of payments on growth. The source of data was the World Bank's World Development Indicators. The results indicated that female employment is an important determinant of external solvency and contributes to overcoming the balance of payments constrain on economic growth. Another salient result is the negative impact of youth unemployment on labor productivity and the negative impact of the percentage of young women that neither study nor work on economic growth. The policy implications are related to the importance of promoting male and female employment with a view towards accelerating economic growth, and the need to establish measures to facilitate women's entry into the labor market. This would require the establishment of national networks of childcare centers, the expansion of early childhood education, improving the quality of education, and increasing wages. As well, policies must be implemented to promote the reindustrialization and reagriculturalization of the Mexican economy to obtain national self-sufficiency and security and impart dynamism to economic growth.