Mexico's Economic Prospects Reconsidered

The paper discusses an alternative macroeconomic strategy proposal for Mexico. The author argues that, in the short-run the primary task should be to put to work idle resources, and that a competitive and stable real exchange rate, coupled with supply-side measures that benefit domestic producers, can contribute to make higher domestic production competitive. Speeding-up growth in the near future would make it easier to achieve a high growth rate in the medium- and long run. However, a medium- and long-run growth strategy entails also a careful investment strategy. Last, an economic strategy must consider also measures to redistribute income, because this will not be achieved as a spontaneous consequence of economic growth.