Regional distortions in resources allocation and manufactures productivity in Mexico

  • Pedro J. Martínez Alanis El Colegio de México
Keywords: non-aggregative growth theory, resource misallocation, total factor productivity, regional development
JEL Classification: D24, O12, O14, O18, O47, R11, R12


This paper decomposes the regional effects of resource misallocation on aggregate total factor productivity (TFP), as a variant of the Hsieh and Klenow (2009a) model. Using establishment level data from the 2004 Mexican Economic Census, I calculate the potential regional TFP gains in Manufacturing. The results suggest that: (i) capital misallocation is the primary source of regional misallocation in the sector; and (ii) resource misallocation within regions is the most important component in manufacturing TFP gains.


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How to Cite
Martínez AlanisP. (2012). Regional distortions in resources allocation and manufactures productivity in Mexico. Estudios Económicos, 27(1), 3-59.
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