The complicity of industrial groups in the underdevelopment of the Mexican economy

Darryl Brent Lanoue, University of Rhode Island

Abstract

The broad purpose of this study was to examine the role that industrial groups play in the underdevelopment of the Mexican economy. Based on Porter's 'diamond' model of competitive advantage, it was assumed that the economic development of a nation is a function of the international competitiveness of its firms and industries. The principal way in which firms become internationally competitive is by pursuing certain global approaches to strategy. Thus, the specific question addressed in this study is: To what extent do Mexican industrial groups pursue global approaches to strategy today?^ An extensive analysis of Mexican industrial history revealed two factors which shaped the global outlook of Mexican industrial groups (MIGs): domestic orientation and dependent development. Based on this analysis, it was hypothesized that MIGs today primarily pursue those strategies which are congruent with these factors.^ Two research methods were used to test the hypotheses: a content analysis of the annual reports of the 17 largest MIGs and a case study of the ALFA group. The findings of the content analysis suggested, as expected, that MIGs prefer three principal global strategies to the exclusion of all others. These results were corroborated by the case study, which further indicated that ALFA relies on international joint ventures in addition to foreign sources of technology, capital equipment, and investment. In conclusion, it was argued that the dependent nature of the MIGs' global strategies and competitiveness serves ultimately to impede the economic development of Mexico. ^

Subject Area

Business Administration, Management|Economics, General

Recommended Citation

Darryl Brent Lanoue, "The complicity of industrial groups in the underdevelopment of the Mexican economy" (1997). Dissertations and Master's Theses (Campus Access). Paper AAI9723563.
http://digitalcommons.uri.edu/dissertations/AAI9723563

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