Mexican stabilization plan: 1982-1989

Vol. 11 No. 4 (1991)

Oct-Dec / 1991
Published October 1, 1991
PDF-Portuguese (Português (Brasil))
PDF-Portuguese (Português (Brasil))

How to Cite

Landau, Elena. 1991. “Mexican Stabilization Plan: 1982-1989”. Brazilian Journal of Political Economy 11 (4):477-99. https://doi.org/10.1590/0101-31571991-0879.

Mexican stabilization plan: 1982-1989

Elena Landau
Departamento Econômico da Confederação Nacional da Indústria e da Pontifícia Universidade Católica do Rio de Janeiro – PUC-Rio, Rio de Janeiro/RJ, Brasil.
Brazilian Journal of Political Economy, Vol. 11 No. 4 (1991), Oct-Dec / 1991, Pages 477-499

Abstract

The paper analyses economic policy measures related to the 1982-89 Mexican
stabilization plan. It shows that the first phase was predominantly orthodox. In a second step,
a deindexation policy was followed, which kept prices and wages virtually constant during
approximately two years. The results so far have been significant reduction of inflation
rates, the main cost being a loss of foreign exchange reserves and a substantial decrease of
real wages. The Mexican stabilization experiment is usually presented as a successful case
of adjustment to the external sector crisis and inflation reduction. A decisive test of the
program, however, will take place when prices and wages were liberalized.

JEL Classification: E31.


Keywords: Inflation stabilization