Abstract

CUEVAS AHUMADA, Víctor Manuel  and  JAIME CAMACHO, Daniel David. Effects of the COVID-19 pandemic on Mexican manufacturing exports: An analysis by subsectors. Anál. econ. [online]. 2024, vol.39, n.101, pp.5-21.  Epub Sep 10, 2024. ISSN 2448-6655.  https://doi.org/10.24275/uam/azc/dcsh/ae/2024v39n101/cuevas.

This paper employs a panel data model to study the impact of six key variables, three of them directly related to the COVID-19 pandemic, on Mexican manufacturing exports. The panel comprises the 21 manufacturing subsectors and monthly data during the January 2020-December 2022 period. Moreover, the model specification entails supply- as well as demand-side variables. The two estimation techniques are ordinary least squares and two- stage least squares. The second estimation procedure corrects for endogeneity problems and is complemented by remedial measures to achieve more efficient parameter estimates. Along these lines, the evidence is robust in showing that manufacturing exports respond positively to an increase in external demand, a real currency depreciation, a drop in unit labor costs (ULC), a wider coverage of vaccination campaigns, and a relaxation of social distancing measures. Given that ULC fall as labor productivity rises, there is a valid rationale to conclude that investing in high- quality formal education, training and skill development could be an effective measure to raise exports. Likewise, the effects of the vaccination efforts highlights the relevance of coordinating economic policy with health policy.

Keywords : COVID-19 pandemic; Panel data models; Unit labor costs; Vaccination policy; Manufacturing exports.

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