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International Business Ethics

2.   During the 1990s, many North American, European, and Asian MNEs set up operations in Mexico, tapping into its location-specific advantages such as (1) proximity to the world’s largest economy (the United States), (2) market-opening policies associated with NAFTA membership, and (3) abundant, low-cost, and high-quality labor. None of these has changed much. Yet, by the 15th anniversary of NAFTA (2014), a significant number of MNEs were starting to curtail operations in Mexico and move to China. Use institution-based and resource-based views to explain why this was the case.

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