The economic diversity

Alongside these measures, the U. S economists have fought hard to maintain fiscal and monetary policies that shall secure them from possible inflation occurences. The policies that were enacted became their tools to maintain sustainable growth and at the same time promote economic expansion while avoiding recessions (“Monetary and Fiscal Policy,” 2001). However, despite these measures and the strong influence that U. S economy has imposed on smaller and less powerful countries, their economy has slowed down.

Their GDP rate started to fall and is predicted to drop lower in the next few years (“The American Economy,” 2006). The Mexican Economy In contrast to the U. S economy who is highly advanced in terms of technological innovations, the Mexican economy is still operating on a rough mixture of semi-modern and outmoded industry and agricultural production (“Mexico, The World Factbook, 2008). However, recent developments in Mexico allowed them to expand their capabilities by developing more advanced technologies in the fields of communication and transportation.

These developments, however are powered by Mexico’s trade and economic relationships with more advanced countries such as the United States and Canada. These advances are heavily reliant with Mexico’s distinct and strong commercial partnerships with these two countries. Their consented participation upon the signing of the North American Free Trade Agreement (NAFTA) increased their activity under the tenets of liberalization and globalization.

In addition, their commitment towards trade liberalization guided them in consolidating and promoting fiscal and monetary policies that shall help them ensure a credible and stable economy. This deliberate openness to foreign trade and investment became an attractive economic feature that increased their foreign direct investments (“Country Briefings: Mexico,” 2008). However, despite the promising economy that Mexico has to offer with their rich natural resources, Mexico is heavily tied on the U. S economy.

Any slowdown that the U. S economy will experience, it is more likely that Mexico will experience the same. U. S Economy vs. Mexican Economy According to the Index of Economic Freedom, the United States economy is 80. 6% free while the Mexican economy is 66. 4% free (“Index of Economic Freedom,” 2008). From this feature alone, it can be recognized that U. S can freely operate their economy without the dictates of other countries, while the Mexican economy flourishes or falls down according to the trend that “superior” countries may impose upon them.

This happens because of certain distinct factors. One is due to the fact that the American economy is technologically advanced compared to the Mexican economy. Thus, U. S gets the upperhand in dictating their terms and conditions to smaller countries, Mexico in particular, because they are highly dependent to the technology that U. S supplies them with. Another distinct factor is that the U. S controls the larger market in terms of trade and investments, thus Mexico only takes partakes the role of an active international player while U. S holds the control over them.

This is true not only on Mexico’s case but in other less developed countries as well. And while it is true that both U. S and Mexico adhere to the tenets of free trade, it is still observable that U. S is in control of the trade agreements. While the Mexican economy operates under certain tariff rates and export controls, the U. S economy operates more freely with less restrictions. Thus, even in a nutshell, it is observable why the U. S is more advanced and economically more powerful.

The economic diversity employed by U. S in their policies is so distinct which enables them to gain control over other economies. And as such, this control over foreign markets allows them to dictate the market grounds, and hence, be on top of the others.


Country Briefings: Mexico. (2008, June 16). Economist. com. Retrieved June 20, 2008, from http://www. economist. com/countries/Mexico/profile. cfm? folder=Profile-Economic%20Data Foreign Trade and Global Economic Policies. (2001 February). International Information Programs. Retrieved June 19, 2008 from http://usinfo. state. gov/products/pubs/oecon/