Productividad y NAFTA: A Comparative Analysis of Mexico's Maquiladora Industry

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Salon, William Spencer
NAFTA; Maquiladoras; Productivity; Free Trade Agreements
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Twenty years after its implementation, the consequences of NAFTA remain unclear, resulting in continued debate and disagreement. While standard economic theory suggests trade liberalization should lead to economic growth, previous studies suggest a more nuanced relationship is appropriate in the case of NAFTA. This study utilizes the Mexican maquiladora (offshoring) sector as a natural experiment, and examines the impact of NAFTA on the productivity of Mexican manufacturing firms in the presence of offshoring and, separately, without it. The study suggests NAFTA had an asymmetric effect, improving productivity in the maquiladora sector while unequivocally reducing it in the non-maquiladora sector.