The Manufacturing Sector in Mexico During the Neoliberal Period

Abstract

The Mexican economy underwent an expansive long wave of rapid capital accumulation from the mid-1930s until the beginning of the 1980s. The structural foundation of this long wave was the elevated levels of profitability that emerged from the structural transformations of the world and Mexican economy that took place during the interwar period and that were reinforced during World War II (WWII). The strong process of capital accumulation came with a constant tendency of the rate of profit to fall, which manifested in Mexico since the second half of the 1960s and endured until the mid-1980s. The consequent structural crisis gave way to the neoliberal restructuring that led to a contractive long wave of capital accumulation that still persists. This chapter analyses the transformations of the Mexican manufacturing sector during the neoliberal period. The general characteristics of the neoliberal restructuring of the manufacturing sector are examined, with particularly, it is emphasized the central role played in this process by the precarization of labor as a precursor and result of the external opening. The articulation of the manufacturing sector to the world market and the effects of international competition in the performance of its various subsectors, distinguishing among the different stages of the external opening, are analyzed. An evaluation is made of the main structural changes experimented by the manufacturing sector through the analysis of the effects of the performance of GDP, Foreign Direct Investment (FDI), investment, productivity, employment, and real wages on the relative dynamics of its different subsectors. A critical evaluation of the manufacturing export-led accumulation model that has emerged from the neoliberal restructuring processes is presented.