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1571. The Institutional Structure of Financial and Monetary Integration the Americas

Author:
Antonio Ortiz Mena and Susan Minushkin
Publication Date:
03-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
Globalization, understood as "an open market place free of institutional or locational constraints" (Weiss) seems to have taken hold of the Americas - for better or worse. There are currently numerous preferential trade agreements (PTAs) and bilateral investment treaties (BITs) in the region. Yet, how close is this image to reality? Do American countries have the institutional framework required to allow a relatively free flow of goods, services and capital within the region? This paper looks into the institutional structures required for financial and monetary integration, through an analysis of BITs, investment and trade in financial services provisions in PTAs, capital account regimes, exchange rate structures, and the possibilities for debt and equity financing within the Americas. It is an empirically-oriented paper that attempts to assess the degree of compatibility between the current institutional structure governing financial and monetary relations in the Americas, and the possibility of attaining relatively free flow of capital and integrated financial markets in the region.
Topic:
Economics, Globalization, and Politics
Political Geography:
America and North America

1572. Bankers into Brokers: The Structural Transformation and Opening of Mexico's Financial Markets

Author:
Susan Minushkin
Publication Date:
03-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
Mexico's financial market opening demonstrates how this domestic logic interacts with international condition. The following case study of Mexican financial opening makes the following contentions. First, financial market opening in Mexico did not begin in the 1980s, as commonly believed. Rather the process has its roots in a conflict among sub-sectors of the financial services industry, between powerful oligarchic bankers (banqueros) and financial entrepreneurs based on the bolsa (bolseros). The conflict, dating from the 1960s, was a purely domestic affair and was not the result of increased international capital mobility and financial marked opening in OECD countries. Nevertheless, this conflict led to a structural change in the financial service industry congruent with changes in the international financial system from bank-based financing to increasing securities market-based financing.
Topic:
Economics, Emerging Markets, and International Trade and Finance
Political Geography:
North America and Mexico

1573. Economic Conditions, Democracy and the IMF

Author:
Susan Minushkin
Publication Date:
03-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
This study seeks to test the hypotheses that different styles of financial market opening can be explained, in part, by general economic conditions and the need to attract external capital. It seeks, as well, to test the some for the more general arguments advanced in the financial market opening literature that financial market opening is a result of a country's increased participation in the international financial system and increased international trade integration. Two specifically political arguments also are tested. The first is that emerging markets opened their markets in response to pressure from the IMF. The second is that there is an association between political freedom and open markets. I test these hypotheses using regression analyses of panel data from a sample of emerging market countries.
Topic:
Economics, Emerging Markets, and International Trade and Finance
Political Geography:
Europe and North America

1574. The Institutional Setting of the NAFTA Debate in the United States

Author:
Miguel Ángel Valverde
Publication Date:
02-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
The objective of this paper is to analyze the institutional setting of the NAFTA debate in the United States, focusing on the interaction between the Presidency and Congress, in the formulation of foreign commercial policy. A series of arrangements have tamed confrontation between the Executive and Legislative powers, reconciling their institutional biases. THese arrangements channel and contain domestic demands for protectionism, favoring international trade liberalization negotiations.
Topic:
Economics, International Trade and Finance, and Treaties and Agreements
Political Geography:
Africa, United States, Asia, and North America

1575. Liberalizaci ó n Commercial y Reforma Burocr á tica en El Área de Tratados Comerciales Internacionales en México.

Author:
Jorge A. Schiavon and Antonio Ortiz Mena
Publication Date:
02-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
The central trade policy priority of the last two administrations (Carlos Salinas de Gortari, 1988-1994, and Ernesto Zedillo Ponce de León, 1994-2000) was the negotiation and the implementation of one very important and ambitious free trade agreement each, the North American Free Trade Agreement and the Mexico-European Union Free Trade Agreement respectively. This working paper explains how and why both administrations were able to successfully deal with the delegation problems that chief-executive principals face with their bureaucratic agents, through a series of institutional reforms. The main argument is that both Salinas and Zedillo had to deal with three specific agency problems: adverse selection, moral hazard, and incomplete enforcement, and that given the characteristics of the Mexican political system prevailing at that time, they were able to successfully solve these problems. These institutional reforms in the foreign economic policy should be understood as a response to agency problems, and not as a reflection of the personal governing style of Salinas and Zedillo.
Topic:
Foreign Policy, Development, and Treaties and Agreements
Political Geography:
Africa and North America

1576. Foreign Policy Strategies in a Globalized World: The Case of Mexico

Author:
Guadalupe González
Publication Date:
02-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
This document analyses the impact of the end of the Cold-War, and the processes of economic and political liberalization on Mexico's foreign policy. The first section identifies the consequences for the so-called intermediate countries of the three most important post-Cold War trends: the emergence of hybrid structure of global power, the wave of globalization, and the growing importance of international institutions. The second section evaluates the explanatory value of three systemic approaches to the study of the foreign policy of intermediate states: systemic-structuralism, middle powers, and pivotal states. In the third section, I evaluate Kahler's alternative approach centered on the interaction between systemic and domestic variables, in particular on the foreign policy consequences of economic liberalization and democratization such as the adoption of external cooperative strategies and the deepening to engagement with international institution. The fourth section describes the main changes that have taken place in Mexico's foreign policy during the 1990s: pragmatism, primacy of economics, closer alignment with the United States, segmented multilateralism, fragmentation of the decision-making process, and new instruments. There are two arguments in this document. First, in contrast to other intermediate liberalizing countries, Mexico's efforts to adapt to the new post-Cold War international system, followed an uneven and partial pattern. While Mexican political leaders pursued the full integration of the country to the international economy, in the security realm they maintain a less than open policy based on the defense of the traditional notion of sovereignty. Mexico's partial adaptation is explained by the different pace of the raid economic reform on the one hand, and the gradual and slow opening of the post-revolutionary political regime, on the other. Second, as Kahler's model predicted, Mexico adopted strategies of cooperation and institutional engagement in order to solve credibility roblems. The need to enhance the credibility of the programs of economic reform pushed the Mexican government to engage actively with economic international institutions.
Topic:
International Relations, Economics, and International Trade and Finance
Political Geography:
Africa, United States, Middle East, North America, and Mexico

1577. The New Federalism, Internationalization and Political Change in Mexico: A Theoretical Analysis of the Metalclad Case

Author:
Arturo Borja
Publication Date:
02-2003
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
In this working paper the reader will find a study of the case that led, within the North America Free Trade Agreement, to the first formal dispute between an American firm and the Mexican Government. The firm, Metalclad, invested $22 million in the municipality of Guadalcazar, in the state of San Luis Potosi, to build a plant to process and store industrial waste. The proper disposal and storage of industrial waste represents one of the toughest environmental challenges faced by Mexico. Thus, the federal government, in the 1990s, has made efforts to attract foreign investment to this area. Metalclad, however, got into a dispute with the municipal and state governments. Finally, in December 1995, the former officially denied Metalclad a construction permit for the plant. This action meant, in practice, the end of the investment project.
Topic:
Economics, Industrial Policy, and International Trade and Finance
Political Geography:
America, North America, and Mexico

1578. Asylum Policy in the West: Past Trends, Future Possibilities

Author:
Matthew J. Gibney and Randall Hansen
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This article examines the policy responses of Western countries in the realm of asylum. We begin by explaining the reasons why the asylum issue has made its way up the political agendas of liberal democratic countries in recent years. While applications for asylum have risen in the last two decades, we also highlight the way rights-based constraints and financial costs have contributed to controversy around the issue. We then examine in detail the major policy responses of states to asylum, grouping them into four main categories: measures aiming to prevent access to state territory, measures to deter arrivals, measures to limit stay, and measures to manage arrival. Moving then to explore the efficacy of these measures, we consider the utility of policy making from the viewpoints of states, asylum seekers and refugees, and international society. The article concludes with the presentation of four new directions in which policies could move in order better to square the professed interests of Western states with the needs of refugees for protection.
Topic:
Human Rights and Migration
Political Geography:
Europe and North America

1579. Economic Polarization Through Trade: Trade Liberalization and Regional Growth in Mexico

Author:
Andrés Rodríguez-Pose and Javier Sánchez-Reaza
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper analyses the impact trade liberalization and economic integration have had on regional growth and regional disparities in Mexico over the last two decades. It is highlighted that the passage from an import substitution system to membership of the General Agreement on Tariffs and Trade (GATT) first, and to economic integration in the North American Free Trade Agreement (NAFTA) later, has been associated with greater concentration of economic activity and territorial polarization. The analysis also shows that these changes herald a period of transition between two growth models. Regional growth in the final stages of the import substitution period was mainly characterized by convergence and linked to the presence of oil and raw materials and proximity to Mexico City. Economic liberalization and regional integration in NAFTA has been related to regional divergence, a reduction of the importance of Mexico City as the main market and to the emergence of an economic system in which the endowment of skilled labour starts to play a more important role.
Topic:
Economics and International Trade and Finance
Political Geography:
North America and Mexico

1580. Mexico Alert: Mexico's Southern Flank: A Crime-ridden "Third U.S. Border"

Author:
George W. Grayson
Publication Date:
12-2003
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies
Abstract:
Mexico's southern flank constitutes a porous, crime-ridden third border of the United States. The problem is that both President Vicente Fox and Homeland Security Secretary Tom Ridge concentrate on the U.S.-Mexican frontier, while neglecting the Mexican-Guatemalan interface that provides an open sesame for narcotraffickers, illegal aliens, prostitutes, smugglers, and terrorists.
Topic:
Security, Economics, and Politics
Political Geography:
United States, Latin America, and North America