The Mexican Miracle Delivers Two Decades of Rapid Growth
Import substitution and a fixed exchange rate produce sustained growth of nearly 7% a year while inequality persists underneath
Quick facts
- Period
- 1958-1970 (Desarrollo Estabilizador)
- Average real growth
- 6.7% per year
- Average inflation
- 3.8% per year
- Exchange rate
- Fixed at 12.5 pesos per US dollar
What happened
Mexico's economic policy in the years generally dated from 1958 to 1970, under presidents Adolfo Lopez Mateos and Gustavo Diaz Ordaz and often called Desarrollo Estabilizador (Stabilizing Development) or the Mexican Miracle, pursued import substitution industrialization: building domestic industries to replace imported goods behind tariff walls, financed partly through the state development bank Nacional Financiera. The government kept the peso fixed at 12.5 to the dollar and held average annual inflation to 3.8%, while real economic output grew at an average annual rate of 6.7% and manufacturing growth averaged 9.0% across both administrations. A stated second objective of the period, alongside growth, was reducing income inequality, though the strategy's benefits concentrated heavily in urban industrial sectors and among the growing middle class.
Why it matters
The Mexican Miracle is the reference point against which every subsequent Mexican economic period, including the 1980s debt crisis and the shift toward trade liberalization, has been measured, and it demonstrates that the political stability the PRI's one-party system provided, whatever its democratic costs, did coincide with a genuinely unusual quarter-century of macroeconomic growth and price stability.
How we know
Growth, inflation, and exchange-rate figures for the period are documented in peer-reviewed economic history research; the classification of the era as running from 1958 to 1970 draws on economist Leopoldo Solis's periodization, cited in that same scholarly literature.
Sources
- Timothy J. Kehoe and Felipe Meza, published in Estudios de Economia (SciELO Chile). Catch-up Growth Followed by Stagnation: Mexico, 1950-2010 · Peer-reviewed (author-declared)scielo.cl · Cited as a "journal" source (no stronger domain match).
- Library of Congress Country Studies. Mexico - Economy - Macroeconomic Management · General sourcecountrystudies.us · Cited as a "reference" source (no stronger domain match). · Link is live and its text matches the event's key terms (Jul 2026)
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