ABSTRACT
One morning at the beginning of 2001, Mexico woke up to the disturbing news that the percentage of the population living in extreme poverty had increased by 4.5 per cent during the previous two years (INEGI, 2001). This announcement paradoxically coincided with the news that the economy had grown by 6.9 per cent in 2001. The question on many people’s minds was ‘how was this possible?’. This outcome was apparently incongruous with the idea that the ‘outward-oriented’ development model, which had been pursued aggressively by the Mexican administration since the beginning of the 1980s, would promote simultaneously both economic growth and welfare. Was the news simply a statistical blip in an otherwise promising panorama of underlying improvement? Or was something more profoundly amiss with the outward-oriented strategy?
