Economy-wide impact of conventional development policies in oil-exporting developing countries: The case of Mexico

Economy-wide impact of conventional development policies in oil-exporting developing countries: The case of Mexico

In Mexico, since the 1970's, the O&G sector has been and still is at the center of national development strategies. This faith in the O&G sector for development and energy security is shared by most oil-exporting developing countries. Understanding their present impact potential is rele...

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Bibliographic Details
Published in:Energy policy Vol. 161; p. 112679
Main Authors: Guevara, Zeus, Sebastian, Antonio, Carranza Dumon, Fabian
Format: Journal Article
Language:English
Published: Kidlington Elsevier Ltd 01-02-2022
Elsevier Science Ltd
Subjects:
Developing countries
Development policy
Development strategies
Economic development
Economic growth
Economics
Employment
Energy development
Energy policy
Energy security
Environmental impact
Environmental policy
Exports
Impact analysis
Input-output analysis
Job losses
LDCs
Mexico
National development
Oil
Oil-exporting country
Petroleum
Policies
Policy analysis
Policy making
Security
Sustainable development
Mexico
Oil-exporting country
Mexico
Energy policy
Input-output analysis
Policy analysis
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Summary:In Mexico, since the 1970's, the O&G sector has been and still is at the center of national development strategies. This faith in the O&G sector for development and energy security is shared by most oil-exporting developing countries. Understanding their present impact potential is relevant to identify insights on their implementation, limitations or even justify their abandonment. This paper aims to analyze the effectiveness of three of such conventional policies regarding their economic, environmental, and social impacts. We implement a scenario methodology, based on the input-output framework, that allows simulating different levels of success in the implementation of these policies. The results confirm the relevance of the O&G sector for the country as its collapse would induce severe economic contractions (about −7%) and job losses (over 350k). Moreover, even though the results suggest that the success of these policies would create substantial benefits, especially when applied in tandem (up to 2.5% of economic growth and around 150k more jobs); other relevant variables that might affect or even nullify the effectiveness of these policies are not considered. Therefore, policymakers of oil-exporting countries should pursue further evidence and pay attention to sustainable development considerations, before judging conventional oil-based development policy strategies. •Effectiveness analysis of several conventional oil-based development policies.•Input-output technique for estimating scenarios of policy-related structural changes.•These policies have socioeconomic benefits but many implementation challenges.•The highest benefits are achieved by implementing these policies in tandem.•It provides policy decision-making insights for oil exporting developing countries.
ISSN:0301-4215
1873-6777
DOI:10.1016/j.enpol.2021.112679