CIAO DATE: 06/05

Liberalizaci ó n Commercial y Reforma Burocr á tica en El Área de Tratados Comerciales Internacionales en México

Abstract

The central trade policy priority of the last two administrations (Carlos Salinas de Gortari, 1988-1994, and Ernesto Zedillo Ponce de León, 1994-2000) was the negotiation and the implementation of one very important and ambitious free trade agreement each, the North American Free Trade Agreement and the Mexico-European Union Free Trade Agreement respectively. This working paper explains how and why both administrations were able to successfully deal with the delegation problems that chief-executive principals face with their bureaucratic agents, through a series of institutional reforms. The main argument is that both Salinas and Zedillo had to deal with three specific agency problems: adverse selection, moral hazard, and incomplete enforcement, and that given the characteristics of the Mexican political system prevailing at that time, they were able to successfully solve these problems. These institutional reforms in the foreign economic policy should be understood as a response to agency problems, and not as a reflection of the personal governing style of Salinas and Zedillo.

Full Text (PDF, 28 pages, 1.90 MB)