Structural Change, Macroeconomic Crises and the Long Run Economic Performance of Output and Growth in the Us and Mexico
We estimate two recursive equations of growth for the US and México of the kind of those initially proposed by Dickey and Fuller (1979). Using the Bai-Perron´s (1998) method of endogenous structural breaks, we find that the debt crisis of the eighties in México was followed by a poor performance of output and growth in this country. Instead, we did not find evidence to support that other crises, like the one in 1995, changed the long run performance of output in México. Another finding is that the 2008 crisis in the developed world did not change the long growth of the US significantly, but it worsened the long run performance of the level of output. Given the strong relation that México has with the US, output in México also suffered a permanent loss.