Trade liberalization in theory and fact: The impact of NAFTA on small corn producers in Mexico

For many Mexicans, it is ironic or incomprehensible that Mexico does not have a comparative advantage in corn production. They find the idea of Mexico becoming reliant on imported U.S. corn for their daily tortillas abhorrent. This was, however, the expectation of the government of Carlos Salinas de Gortari when it negotiated the North American Free Trade Agreement (NAFTA). The Salinas government dramatically reoriented Mexico towards export-oriented industry and agriculture, focusing on fruits and vegetables. Ten years after NAFTA's implementation, however, the corn sector has not restructured in the ways expected by Salinas and many economists. Despite a 40 per cent drop in the corn price, Mexican production has remained steady, including in the small-scale, largely subsistence sector that was expected to release labour. Through the results of a qualitative-quantitative survey with 77 small corn producers, this paper sheds light on the micro-level experience of change and continuity since NAFTA.