Towards a Prosperous and Productive Chiapas: Institutions, Policies and Public-Private Dialogue to Promote Inclusive Growth

Abstract:

Since the Zapatista revolution of January 1994, Chiapas has received an enormous amount of resources from the federal government. The gaps in years of schooling between Chiapas and the rest of Mexico have been reduced, and numerous investments have been made that have improved road infrastructure, ports and airports. However, the gap that separates Chiapas from the rest of Mexico has been steadily widening. A multidisciplinary team of twelve experts has dedicated itself to studying different aspects of the productive, political and social dynamics of Chiapas. From there, five base documents have emerged: Institutional Diagnosis, Economic Complexity, Growth Diagnosis, Poverty Profile and a pilot of productive dialogue carried out in an indigenous community in Chiapas.

Our hypothesis is that Chiapas is in a low productivity trap. Modern production methods, closely linked to the growth and development process, require a set of complementary inputs that are absent in most of the territory of Chiapas. Thus, there are no incentives to acquire new knowledge that could be used in industries that do not exist. This inability to solve coordination problems and provide the inputs required by modern production has caused a good part of the social investment that has been poured into the entity to be wasted.

To overcome the current dilemma and ignite the spark of growth, Chiapas needs to solve its problems of coordination, connectivity, and gradually promote greater complexity. Our recommendations are based on taking advantage of the agglomerations of knowledge that already exist in the main urban centers of Chiapas, to address new productive sectors with greater added value and complexity. To overcome this challenge, it is necessary to create a public-private structure that iteratively solves the problems of coordination and provision of public goods that these high-potential sectors require. Public transport systems and housing policy are mechanisms to integrate the population surrounding urban centers to the new productive dynamics.

CID Working Paper: 317
Last updated on 01/21/2021