Mexico's economic structure
What structure would you give to Mexico’s 2006 GDP, the wealth it generated in a year? Just gather your prejudices, take a guess, and try to put it into numbers.
Mexico’s 2006 GDP Structure
| Agriculture: | % |
| Industry: | % |
| Services: | % |
| 100 % |
Personally, I believe I would have said something very much like many of my friends, 30% for agriculture, 50% for industry, and 20% for services. We’re a nation of corn and maquiladoras, aren’t we? Plus, services are the fancy future of advanced knowledge economies, aren’t they?
Imagine then my surprise when I read the CIA’s World Factbook 2006 estimates:
Mexico’s 2006 GDP Structure (estimates)
| Agriculture | 3.9% | |
| Industry: | 25.7% | |
| Services: | 70.5% |
Services aren’t the future, they’re already, the overwhelming bulk of our present. Agriculture is a wealth blip, half the percentage of tourism (which according to Sectur was 7.8% of the 2004 GDP)). Industry is important, a quarter of our wealth, but it is clearly not our thing. Our thing is services. We’re a service economy!
The second shock came when I learned the US’ corresponding stats.
United States’ 2006 GDP Structure (estimates)
| Agriculture | 0.9% | |
| Industry: | 20.4% | |
| Services: | 78.6% |
That’s right, we’ve pretty much the same structure as the most advanced economy in the world. As the most advanced economies in fact, they’re all remarkably similar to each other:
European Union’s 2006 GDP Structure (estimates)
| Agriculture | 2.1% | |
| Industry: | 27.3% | |
| Services: | 70.5% |
Japan’s 2006 GDP Structure (estimates)
| Agriculture | 1.6% | |
| Industry: | 25.3% | |
| Services: | 73.1% |
On the other hand, Mexico’s often mentioned Latin American rival, Brazil, has a distinct structure, more like one I would have expected of Mexico (and yet notice how sevices still account for just over half the wealth):
Brazil’s 2006 GDP Structure (estimates)
| Agriculture | 8% | |
| Industry: | 38% | |
| Services: | 54% |
The sad difference between Mexico and the first world, other than the obvious detail of productivity (Mexico’s nominal per capita28nominal%29_percapita is one fifth the US’s)%, is quickly evinced by comparing wealth and labor structures.
| Mexico’s structure (estimates) | ||||
| 2006 GDP | 2004 Labor | |||
| 3.9% | Agriculture | 18% | ||
| 25.7% | Industry | 26% | ||
| 70.5% | Services | 56% | ||
| US’ structure (estimates) | ||||
| 2006 GDP | 2004 Labor | |||
| 0.9% | Agriculture | 1% | ||
| 20.4% | Industry | 24% | ||
| 78.6% | Services | 74% | ||
The labor figures are from INEGI, Banxico, US Census Bureau, and the Department of Commerce. I took them from Sergio Aguayo’s Almanaque Mexico-Estados Unidos. What they reaveal is the Mexican disproportion, particularly brutal in agriculture where one 5th of the population creates one 25th of the wealth.
5 Comments
yeah, doesn’t surprise me at all, bothers me slightly though, i wish we could have a ‘correct’ (and i use this in a strict normative jugdment fashion – a direct translation, does that even exist? – ), between agriculture and the rest…
Although we are leading towards 50 million obese (an unequivocal sign of progress and wealth) i wish we had more agriculture and stuff like that, after all, i can’t eat a massage, or drink from the call center… actually, can someone?anyways, just wanna stress the point of ‘yeah services! let’s goooo!’, because, when we have enough fat people to make it into the first world category, allah knows we are gonna need all the gyms we can get.
have fun!I would have been shocked had it surprised you! ITAM has to be worth something. :)
I don’t know about the correct proportion of agriculture. It being a very small fraction of our wealth is a very different thing than having too little of it. Plus, you know what I think about self-sufficiency.Anyway, why do you think we have this structure? Proximity to the US? NAFTA? Did we have this structure 10, 20, 30 years ago (I can’t find historic stats!)?
yeah, not thinking about self sufficence either: maybe we can have more agriculture so we can sell it to the african countries at market prices, then we would have enough money to buy ipods (in less than a year’s worth of salay, no less!) and put lullabies in them, so they can serenade us while we sleep, thinking about the economic proficiency we achieved while solving world hunger with an externality to which we don’t have the means to charge anything for… yet
in other news, i think i saw historic references somewhere in almanacs from the minister of economy, id have to double check at the museum of economy though. Although, with an ‘ojo de buen cuber’ i seriously doubt agriculture represented the majority of our economic structure after the late 80’s in XIX century.Interesting note about the GDP fraction of Agriculture—Household spending on food at home has decreased from 20% in 1929 to 9% in 1980 to 5.8% today. Meanwhile, the non-marketing fraction of all food expenditures (i.e. the cost as it leaves the farm) has fallen from 41% in 1950 to 20% today. That means that the fraction of household income headed to farmers has dropped from 8% (1950) to 1.9% (2004). The ag industry has realized enormous productivity gains, while per-capita demand is relatively inelastic (not totally inelastic: note the growth in marketing expenditures and food-away-from-home) These gains have made the food we eat today markedly better, at a fraction of the cost, from a much smaller (GDP-fraction) industry.
Fascinating comment Philip, thanks! You reminded me of two related observations:
Americans spend..”..nearly half their food dollars on restaurant meals”