Failure or Economic Prosperity. [Real Case]

The city of Nogales is divided in two by a fence. If one stands next to the
fence and look north, go Nogales (Arizona), belonging to the county of Santa Cruz. The average income of
A household is about $ 30,000 a year. Most teenagers go to
institute and most adults have high school. Despite all the controversy that
they generate the deficiencies of the United States health system, the population is relatively healthy,
and has a high life expectancy according to world criteria. Many of the residents
They are over the age of sixty-five and have access to the Medicare health care program.
This is one of the many services that the government provides that most people take for granted.
sitting, as it happens with electricity, telephone, sewerage, public health, a network
of roads that connect them to other cities in the area and the rest of the United States and, last but not least
less important, law and order. The people of Nogales (Arizona) can make their
daily activities without fearing for their lives or their safety and do not have a constant fear of theft,
expropriation or other things that could endanger investments in their businesses and homes.
Equally important, residents of Nogales (Arizona) take it for granted that, despite their
inefficiency and sporadic corruption, the government is its agent. They can vote to replace their mayor,
and to congressmen and senators; vote in the presidential elections that determine who will direct the
country. Democracy is something natural to them.

Source

Life south of the fence, only a few meters away, is quite different. In spite of
that the inhabitants of Nogales (Sonora) live in a relatively prosperous part of Mexico, the income
average of any home is about one third of what they have in Nogales (Arizona).
Most adults in Nogales (Sonora) do not have a high school diploma and many
teenagers do not go to the institute. Mothers worry about the high rates of infant mortality.
The conditions of public health are deficient, which means that it is not surprising that
The inhabitants of Nogales (Sonora) are not as long-lived as their northern neighbors. Also, they do not have
access to many public services. The roads are in poor condition south of the fence. The law and the
order are in even worse condition. There is a lot of crime and opening a business is a dangerous activity.
In addition to risking theft of one, the fact of getting all permits and bribes
only to open is not easy at all. The inhabitants of Nogales (Sonora) live daily with the
corruption and the ineptitude of politicians.
Unlike what happens with its northern neighbors, democracy is a very
recent for them. Until the political reforms of the year 2000, Nogales (Sonora), like the rest of
Mexico, was under the corrupt control of the Institutional Revolutionary Party (PRI).
How can the two halves of what is essentially the same city be so different? Do not
there are differences in the climate, the geographical situation or the types of diseases present in the area,
since the germs do not face any restriction when crossing the border between both countries.
Obviously, sanitary conditions are very different, but this has nothing to do with the
environment, but that is because the population south of the border lives in worse
health conditions and lack of decent medical attention.

Source

But perhaps the inhabitants are very different. Could it be because the people of Nogales (Arizona) are
grandchildren of immigrants from Europe, while those of the south are descendants of the Aztecs? No. The
The origins of the people on both sides of the border are quite similar. After Mexico
became independent from Spain in 1821, the area around "Las dos Nogales" was part of the
Mexican state of Old California and continued like this after the Mexican-American War
United that took place between 1846 and 1848. In fact, it was after the purchase of Gadsden of 1853
when the US border was extended to this area. It was Lieutenant N. Michler who, while
He watched the border, noticed the presence of the "little and pretty valley of Nogales." Here, in both
sides of the border, the two cities grew. The people of Nogales (Arizona) and Nogales
(Sonora) share ancestors, enjoy the same food and music and even us
We would venture to say that they have the same "culture".

Source

Obviously, there is a very simple and obvious explanation of the differences between the two halves
Nogales that the reader will have already guessed: the very frontier that defines the two halves. Nogales
(Arizona) is in the United States. Its inhabitants have access to economic institutions
Americans, which allows them to choose their work freely, acquire academic training and
professional and encourage their employers to invest in the best technology, which, in turn,
that they earn higher salaries. They also have access to political institutions that allow them
participate in the democratic process, elect their representatives and replace them if they have a
inappropriate behavior Therefore, politicians provide basic services (from health
public up to roads and law and order) that citizens demand. Those of Nogales (Sonora) do not
They are so lucky They live in a different world shaped by different institutions. They create
very different incentives for the inhabitants of Las Nogales and for the entrepreneurs and the
companies that want to invest there. The incentives created by the different institutions of the two
Nogales and the countries in which they are located are the main reason that explains the differences in
economic prosperity on both sides of the border.

Source

Why do US institutions lead much more to economic success than those of
Mexico or, in fact, that of the rest of Latin America? The answer to this question is found in
how different societies were formed at the beginning of the colonial period. At that time,
It produced an institutional divergence whose implications still persist. To understand this
divergence, we must begin to observe the founding of the colonies of North America and America
Latina

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Publicado en el blog de Cryptofera

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