Mexico has been a reform champion, having launched ambitious reforms in a broad range of areas. While the reforms are showing first positive effects they are not delivering to the extent they could...

Getting it Right is one of the most complete toolkits that the OECD has designed to help a country at the start of a new government administration.

This report finds that the Mexican higher education system needs to be better aligned with the labour market to help students develop the skills employers seek. Students need better support to succeed in their higher education studies and develop labour market relevant skills, which will help facili

This Technical Assistance report on Mexico discusses public investment management assessment (PIMA). It evaluates 15 key institutions in terms of their institutional strength and effectiveness across the planning, allocation, and implementation phases of the PIM cycle, identifies strengths and weaknesses in the existing PIM framework, and produces an action plan to improve PIM. This assessment found that most of Mexico’s institutions scored as medium strength in terms of institutional design and effectiveness. It is recommended to include a medium-term target for the public sector borrowing requirement, introduce an independent body to review and assess the quality of the macro-fiscal projections, and amend the fiscal rule’s escape clause so it is only used in exceptional circumstances. In addition, expand the economic assumptions report to include more information on fiscal strategy and analyses of medium-term fiscal parameters. It is also recommended to develop mechanisms for coordination of public investment plans at federal and subnational levels to enhance efficiency and synergies of planning and investment prioritization.

The Trump Paradox: Migration, Trade, and Racial Politics in US-Mexico Integration explores one of the most complex and unequal cross-border relations in the world, in light of both a twenty-first-century political economy and the rise of Donald Trump. Despite the trillion-plus dollar contribution of Latinos to the US GDP, political leaders have paradoxically stirred racial resentment around immigrants just as immigration from Mexico has reached net zero. With a roster of state-of-the-art scholars from both Mexico and the US, The Trump Paradox explores a dilemma for a divided nation such as the US: in order for its economy to continue flourishing, it needs immigrants and trade.

Mexico’s robust macroeconomic policy framework has supported moderate growth despite several headwinds in recent years. However, low productivity growth has hindered Mexico’s convergence to higher-income OECD countries and inequalities remain high. These factors call for a renewed strategy to boost productivity and inclusiveness.

This report provides an assessment of the use of, and recommendations for scaling up, Nature-based Solutions to address water-related climate risks.

Mexico has been a reform champion, having launched ambitious reforms in a broad range of areas. While the reforms are showing first positive effects they are not delivering to the extent they could. On many dimensions of well-being, including education, health and security amongst others, Mexico still lags behind the OECD average and regional development remains very uneven. While Mexico has done a lot to build a competitive economy, progress has been too slow in two complementary areas, namely strengthening institutions and fostering inclusion. The capacity of the public sector is weak, corruption remains widespread and the rule of law is week, all hindering trust in government institutions and the effective implementation of policies. Similarly, persistent inequalities and widespread poverty do not only mean that higher growth does not translate into widespread gains in well-being; these inequalities are also holding back growth as Mexico is not using all available talent. Mexico has taken measures to tackle these issues, but important implementation gaps remain. It will be important for the next government to build on past reform efforts, ensuring the full and effective implementation of already legislated changes to allow for reform continuity and to launch additional reforms in several priority areas, including the rule of law, education and social protection. Only then will Mexico be able to deliver a higher quality of life for all its people.

Despite various reform efforts, Mexico has experienced economic stability but little growth. Today more than half of all Mexican workers are employed informally, and one out of every four is poor. Good Intentions, Bad Outcomes argues that incoherent social programs significantly contribute to this state of affairs and it suggests reforms to improve the situation. Over the past decade, Mexico has channeled an increasing number of resources into subsidizing the creation of low-productivity, informal jobs. These social programs have hampered growth, fostered illegality, and provided erratic protection to workers, trapping many in poverty. Informality has boxed Mexico into a dilemma: provide benefits to informal workers at the expense of lower growth and reduced productivity or leave millions of workers without benefits. Former finance official Santiago Levy proposes how to convert the existing system of social security for formal workers into universal social entitlements. He advocates eliminating wage-based social security contributions and raising consumption taxes on higher-income households to simultaneously increase the rate of growth of GDP, reduce inequality, and improve benefits for workers. Go od Intentions, Bad Outcomes considers whether Mexico can build on the success of Progresa-Oportunidades, a targeted poverty alleviation program that originated in Mexico and has been replicated in over 25 countries as well as in New York City. It sets forth a plan to reform social and economic policy, an essential element of a more equitable and sustainable development strategy for Mexico.

Why has an economy that has done so many things right failed to grow fast? Under-Rewarded Efforts traces Mexico’s disappointing growth to flawed microeconomic policies that have suppressed productivity growth and nullified the expected benefits of the country’s reform efforts. Fast growth will not occur doing more of the same or focusing on issues that may be key bottlenecks to productivity growth elsewhere, but not in Mexico. It will only result from inclusive institutions that effectively protect workers against risks, redistribute towards those in need, and simultaneously align entrepreneurs’ and workers’ incentives to raise productivity.