Getting it Right: Strategic Priorities for Mexico “Fostering Development at the Regional Level” Enrique Garcilazo, OECD Center for Entrepreneurship, SME Regions and Cities JoseEnrique.Garcilazo@oecd.org @Garcilazo_OECD

Convergence of countries vs. divergence of regions in the OECD GDP per capita dispersion is now greater within countries than between countries Source: Bartolini, D., S. Stossberg and H. Blöchliger (2016), "Fiscal Decentralisation and Regional Disparities", OECD Economics Department Working Papers, No. 1330, http://dx.doi.org/10.1787/5jlpq7v3j237-en.

Spatial inequalities are substantial in Mexico

Size matters for productivity The econometric estimates show on average that the productivity increase associated with increasing a city’s population—is in the order of 2-5% for a doubling in population size.  This implies, e.g., that – on average - moving from a city of roughly 100,000 inhabitants to a city of 12,000,000 agglomeration increases productivity by an order of magnitude of around 30%.

Mexico displays lower agglomeration benefits than other OECD countries

National urban policy framework For a given population size, a metropolitan area with twice the number of municipalities is associated with 5-6% lower productivity.

thank you JoseEnrique.Garcilazo@oecd.org