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Title: God dies every six years : politics, public finance and inequality in Mexico
Author: Koli, Marianna
ISNI:       0000 0004 2699 5480
Awarding Body: University of Manchester
Current Institution: University of Manchester
Date of Award: 2011
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The purpose of this study is to investigate the impact of Mexico’s political system on economic inequality between the 32 states of the federation. Longstanding economic divergence between states is occurring despite public finance programmes aimed at reducing poverty. These programmes have not helped poor states develop their economies significantly, and many states have stagnated. At the same time, Mexico’s “diamond regions” or wealthy states have experienced healthy growth. The aim of this study is to show that it is the formal and informal political institutions that keep these programmes from aiding economic development in poor states. A key issue is the ability of poor states to raise finance, which could induce economic development and growth. This is examined in the context of the transition to democracy, with specific focus on political competition. This thesis aims to show the intersections between politics and economics in a growth context, bringing together the Mexican political transition literature and the existing work on subnational economic development. The empirical testing is done with Generalised Method of Moments (GMM), and the statistical analysis is supplemented by correlation and graphical analysis. The influence of political competition on public finance is tested using ordinary least squares (OLS) and GMM. A GMM calculation is also administered to test the relationship between public finance and state wealth. The findings indicate that political influence remains in Mexican public finance. The results suggest that the presence of more than one party in state politics coincides with significantly higher public finance levels than those found in a single-party state. These results also show that poverty and federal finance are significant determinants of each other, meaning that there is a vicious circle between federal funding and state wealth. The impact of federal finance on state wealth is especially salient where there are no specified rules for the spending of the federal money. Finally, some policy suggestions are made. The issues found to require adjustments include the re-election ban, the poor availability of statistical information to decision-makers, and particular details of the federal funding distribution formulae.
Supervisor: Arun, Thankom ; Sen, Kunal Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: Economic Development ; Public Finance ; Politics ; Mexico