NAFTA AND THE MAQUILADORAS: BOON OR BANE?

"This article examines the factors that affect the value added of the maquiladoras as a group as well as the apparel, electrical equipment, food, furniture, and motor vehicle equipment industries. It also explores the impact of the North American Free Trade Agreement (NAFTA) on the maquiladoras. The economic variables of relative wage rates, relative prices between Mexico and the United States, and U.S. real gross domestic product generally appear to have their expected effects. However, with the possible exceptions of the clothing and electrical equipment industries, this study suggests that NAFTA had either a negative impact or no effect on the maquiladoras." ("JEL" F14, 054) Copyright 2007 Western Economic Association International.