Globalization and it's effects on mexican's income

Abstract

This paper analyzes the effects due to globalization in Mexico, particularly those associated with average income and the trade openness, based on the hypothesis that global openness affects negatively the Mexicans average income.

To reaffirm the hypothesis of an inverse relationship between the trade openness and the average income, a statistical analysis is presented based on the two steps ordinary least squares methodology, with purpose of controlling the endogeneity problems of this kind of models. The variables considered are poverty, Average Income, Commercial Opening, Education and Spending.

The research was focused on studying the phenomenon with the average income as dependent variable, leaving the rest of income inequality metrics to future works. The results suggest a decrease in the average income as the commercial opening increases. That result invites to strengthen the income distribution topic and the job remuneration of the jobs in the debate and negotiation of future commercial treaties.