This thesis is devoted to analyzing the political transition that Mexico experienced from 1968 to 1988, through three sources of information; historical documents, economic and demographic statistics and public opinion. The first part of the work examines four particularly relevant historical processes concerning the relationship between State and society that can be identified by very precise symbolic events defined here as crisis: 1) the October 2, 1968, massacre that culminated the student uprising; 2) the August 31, 1976, peso devaluation that marked the climax of the confrontation between the Echeverrista government and the domestic business class; 3) the September 1, 1982, bank nationalization that symbolized the excesses of the oil boom and foreign indebtedness; 4) the October, 1987, stock market crash that ended unrealistic market euphoria of political origin. The second part of the thesis seeks to quantitatively outline these historical processes and establish a basis for comparing them one with another. To this end, several statistical series from 1940 to 1987 are used to measure the social, economic and political behavior of the period with the purpose of clarifying the relationship between the qualitative historical facts and the quantitative statistical figures. The third part is dedicated to examining the opinions of individuals or, more precisely, the different perceptions that for different reasons Mexicans held about the same events and circumstances, as well as the effect that such a heterogeneous mix of opinion can have on a nation's ability to persevere in the face of the four crises of the last 20 years.

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This thesis is about economic transformation in Mexico City between 1980 and 2000. It explores the extent to which Mexico City’s economic restructuring process has been caused by trade liberalisation. The thesis assesses the extent to which industries located in Mexico City reacted to a reorientation in production focus, characterised by the shift from national to international markets. It analyses in detail the pace and geography of neo-liberal economic change, and its effects upon a specific location. It also evaluates the role played by global economic agents in gauging the forces influencing economic restructuring in Mexico, and particularly in Mexico City. At the core of this restructuring process is the change in regional industrial location patterns in Mexico, as well as the decline of manufacturing – with regard to production and employment – in Mexico City and its rise as a service centre. The thesis therefore engages with current debates on new economic geography on the one hand and globalisation on the other, focusing attention on the possible emergence of a group of “global” urban centres embedded in a broader network of cities in developed and developing countries alike, which connect global production circuits and coordinate global/regional markets. More concretely, the thesis focuses on the automotive and consumer electronics industries with the aim of understanding the causes and effects of economic events in terms of location decisions, particularly those made by transnational corporations. By placing the empirical processes of economic restructuring within the theoretical context of trade liberalisation and globalisation, I seek to make an original contribution to social science debates about the way industry reacts to economic signals and how global processes, despite taking place in specific locations, have wide-reaching effects upon social welfare, mainly though the transformation of local labour markets.

Due to its competitive political system and strong non-oil export capacity, Mexico is not considered an oil Rentier State. Yet, the consistent and intensive use of crude oil has fundamentally altered the trajectory of its political economy. State institutions, which had consistently relied on oil rents to finance their operations, tend to preserve social stability and political consensus rather than promote development. The central bureaucracy’s need to control oil rent strengthens and reinforces the role of budgetary institutions within politics and administration. Budget institutions provide the government with an inordinate degree of discretion to allocate the budget, a capacity that supports the State’s political legitimation and helps to overcome economic turmoil. Paradoxically, oil produces a policy curse that reinforces the State’s socio-political embeddedness at the expense of its economic leverage. Thus, undermining the incentives for public officials to tax and deliver expenditure quality, thereby deepening the State’s detachment from normal economic behaviour. Oil rent maximization serves to increase the size and cost of public employment and the magnitude of transfers and subsidies at the expense of gross fixed public investment, the maturation of a merit-based bureaucracy, and the Legislature’s role in controlling the Executive. In addition, rents short-term logic is inimical to the country’s long-term strategic planning because they do not provide public and sectoral policies with a sound financial basis. Rentier behaviour is enforced within the State apparatus by a structure of incentives where budgeteers and elected officials are largely exempted, given budgetary secrecy and discretion, to make enforceable and accountable commitments. In order to provide for valid causal inferences and increase explanatory leverage, research findings are supported by a comprehensive use of quantitative and qualitative primary sources (period 1970-2010) as well as pertinent comparative observations from other oil endowed States. Finally, by considering Mexico an outlier, this research refines some of the theoretical and methodological insights of the available literature on rentier States.

This thesis analyses how trade liberalisation and Foreign Direct Investment (FDI) have impacted on Mexico’s economy. Time series econometric estimations techniques and estimations of a dynamic simultaneous equations system were conducted using quarterly data (from 1980 to 2002). In a VAR framework, calculations showed that only exports do Granger cause GDP. Under NAFTA, it emerged that exports and GDP do Granger cause FDI. Variance decomposition and impulse response functions confirmed the relative importance of each variable in the system. 3SLS estimations including instruments of fiscal and monetary policies and inflation, demonstrated that the main determinants of GDP are capital accumulation, labour productivity and FDI. Other findings confirm that exports, differences in relative wages and currency depreciation are explicative of FDI. Exports are highly dependent on the world economy and exchange rate fluctuations. Labour productivity and FDI improve human capital. Similarly, GDP and human capital induce productivity gains and capital accumulation improves due to technology transfer, infrastructure, personal income and peso appreciation. Dynamic effects of government policies and exogenous variables were analysed via multiplier analysis. The real exchange rate and world economy exert the strongest acceleration on exports and FDI growth. Multiplier effects of the monetary base showed than an expansionary monetary policy has the capacity to decelerate the interest rate and thereby to enhance FDI and its spillovers.