PRODUCTIVITY IN THE MANUFACTURING INDUSTRY AS A DETERMINANT OF ECONOMIC GROWTH: STATE OF HIDALGO, 1999-2004

Currently, the national macroeconomic context and the redefinition of the growth strategy have led economic agents to modify their production standards in order to become more competitive in the face of greater exposure to international markets. Under this dynamic, companies and industries have found it necessary to adjust their workforces and implement productive and organizational improvements that allow them to increase their productivity either through the search for technical and allocative efficiency or through technological change. The rhythm of these modifications has been marked by the commercial opening of the Mexican economy and by the incidence of shocks in the economic cycles, in this way the State of Hidalgo has been immersed in this process.this work intends in a first moment to make known the diversification, specialization and exporting base of the manufacturing industry since this analysis allows a deeper knowledge of the economic structure of this industry. In such a way that it allows to be a frame of reference of some variables that are related to the research such as the industrial location of the manufacturing industry at municipal level, its specialization index, as well as its contribution to the economic growth, in a second moment it is intended to make an analysis based on the total productivity of the production factors that is a component of great importance for the economic growth of the country, since a higher productivity of the business sector will generate a higher added value in its products that will allow them to have a greater competitiveness. The aim of this study is to analyze the total factor productivity (TFP) of the manufacturing sector of the State of Hidalgo in the period 1999-2004. The theoretical-methodological support of the TFP measurements is proposed using the Malmquist index calculated through the non-parametric frontier technique1 and the Cobb Douglas function for the cross-sections of the study periods.The objective of this work is to identify those subsectors and classes of industrial activity that present a better performance in the State of Hidalgo and to evaluate the behavior of the industry, to establish if there were changes in the performance patterns between the 1999-2004 subperiod and the 2004-2004 period.