ECONOMIC INTEGRATION AND INDUSTRY LOCATION: INDUSTRIALIZATION AND SPATIAL CONCENTRATION 2

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In Canada, industrial activity has historically also been spatially agglomerated. The country’s manufacturing belt appears to be largely an extension of the U.S. manufacturing belt. Table 2 shows the regional distribution of manufacturing employment in Canada for the period 1926-1995. Ontario, which adjoins the major manufacturing regions of the U.S. northern midwest, has had just under half of Canada’s manufacturing employment for most of this century. In contrast to the United States, the spatial distribution of manufacturing activity in Canada has been quite stable over time. The lack of dynamism in industrial location in Canada when compared to the United States is an interesting point of contrast between the two countries, which has received relatively little attention in the academic literature.

It is perhaps less well known that regional industrial development in Mexico has followed a pattern broadly similar to that in the United States. The Mexican economy begin to industrialize in the 1930’s. What was initially a de facto process of import-substitution industrialization (ISI), due to rising trade barriers and the Great Depression in the United States, became de jure in the 1940fs, as the government raised import tariffs, adopted a system of import licenses, and imposed export controls as means to promote domestic industry. credit

Given the narrow goal of ISI, the policy was largely successful. Between 1930 and 1970, the share of manufacturing in Mexican GDP increased from 12.9% to 23.3%, as Mexico expanded and diversified its manufacturing base.