IDEAS home Printed from https://ideas.repec.org/a/taf/irapec/v38y2024i5p457-481.html
   My bibliography  Save this article

Profit share and capital accumulation in Mexican manufacturing

Author

Listed:
  • Carlos A. Ibarra

Abstract

Mexican manufacturing shows a long-run divergence between a rising profit share of income and a flat rate of capital accumulation. Following the Cambridge equation, the paper studies the determinants of capital accumulation and finds the divergence to be partly explained by a reduction in the output/capital ratio, which opened a gap between a rising profit share and falling profit rate. But besides this classical, Marxian mechanism, two additional factors were at play: first, nonlinear profitability effects, which reveal that, at the high profitability rates observed in Mexico, profitability was not a binding constraint on accumulation; and second, foreign profitability effects, which show that a rise in US profits rates affected negatively accumulation in Mexico. The results come from estimated equations for the capital accumulation rate and investment share of profits in an annual panel of 17 manufacturing industries during the period 1992–2019.

Suggested Citation

  • Carlos A. Ibarra, 2024. "Profit share and capital accumulation in Mexican manufacturing," International Review of Applied Economics, Taylor & Francis Journals, vol. 38(5), pages 457-481, September.
  • Handle: RePEc:taf:irapec:v:38:y:2024:i:5:p:457-481
    DOI: 10.1080/02692171.2023.2291564
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/02692171.2023.2291564
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/02692171.2023.2291564?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:irapec:v:38:y:2024:i:5:p:457-481. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIRA20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.