Patterns of total factor productivity growth in Mexico : 1991-2011

We review some patterns of Total Factor Productivity (TFP) growth in the Mexican economy during the period 1991-2011 using the KLEMS data set published by INEGI in 2013. The data shows a strong positive correlation between TFP and output growth. As a result, tests were performed in order to determine a possible causality between these two variables, with the results not rejecting the hypothesis of causality running in both directions. Another pattern that also emerges from the data set is that TFP growth in Mexico tends to be fairly concentrated and highly irregular, as just a reduced share of the subsectors in any given time period tends to account for most of the TFP growth, and also because the distribution of their performance is far from being the same across time. These patterns are similar to those found in other data sets of the Mexican economy, as well as in data from the United States and the United Kingdom at different levels of aggregation.