Transnational “Maquiladora'’Location

Abstract

Assembly manufactures in Mexico whose production is primarily destined for export markets are referred to as maquiladoras. Maquiladoras are a growth industry generating the second largest source of foreign exchange earnings, and the country is increasingly the location of choice for (U.S.) labor-intensive manufactures. This research is an analysis of transnational assembly plant location and is organized on the premise that transnational location can be viewed as a problem of scale. At an international scale, the product life cycle provides a conceptual framework for an understanding of industrial relocation. Labor costs for industries in the later stage of their product cycle are the primary explanation for manufacturing locational change. Data on location decisions at an intranational scale were obtained by telephone and personal interviews with 300 maquila plant managers. The responses reveal that maquilas are regionally oriented along the Mexican border with reference to U.S. markets and parent plants; urban location is influenced by the perception of labor availability. A number of anomalies are apparent between labor, the most important factor of production for maquilas, and locational choice. The presence of an infrastructure, industrial parks, and management companies (shelter plans) are additional important locational variables. Transnationals seek assistance in foreign areas to expedite the search process and start-up manufacturing. This expertise is provided by entrepreneurs who promote not only Mexico, but urban places where they have a vested interest. The contribution of maquilas to Mexico's economic growth is important. The concentration of assembly plants along the northern border mitigates their development role due to wage expenditures in the U.S. The paucity of linkages with indigenous manufactures and the pattern of forward linkages to U.S. parent plants raise issues of dependency development and development for whom. If maquilas are to contribute to regional economic development, then growth must be directed to interior cities. To accomplish this, labor availability is important, but a prerequisite is the entrepreneurial promotion and development of an infrastructure in off-border locations.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 42 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.