The View From Mexico City

I was in Mexico City the other day, giving a talk at a conference sponsored by the Mexican Stock Exchange, which is considering going public. The conference was primarily an educational one (except for my talk). Among the big issues of the day: offering Mexican investors some of the shiny financial instruments that Americans are fond of, in particular REITs and (careful, now) mortgage-backed securities.

Sadly, I was only in town for a few hours, and since it was a Monday, most of the museums were closed. But I can’t wait to return: the people I spoke with (especially the university students) were smart and incredibly energetic, and I’d like to learn much more than I know about Mexico. (It was embarrassing to me that I live in New York City, where so much Spanish is spoken, and that none of it is spoken by me.)

In the meantime, here are a few snapshots:

Mexico Traffic

Yes, the traffic is pretty bad, but probably no worse than in most large cities. As you can see, most of the cars are small (including a lot of VW Beetle taxis), but lately American SUV’s have become popular. The fuel of choice is gasoline, not sugar ethanol as in Brazil, and the current price is about 8 pesos per liter, or roughly $3 per gallon. Interestingly, I didn’t see a single gas station that posted its prices in huge numbers, like every U.S. gas station does.

Mexico Wave Fountain

While I didn’t get to see any museum art, the colors and shapes everywhere you look are fantastic, bordering on otherworldly. This is the view from the main lobby of my hotel. The circular fountain is a wave pool, the most mesmerizing fountain I’ve ever seen. I could have stood and watched this fountain against the red and yellow walls forever.

Mexico Street Sign

Here’s an intersection I came upon during my morning stroll. The intersection of Descartes and Victor Hugo: from what little I saw of Mexico City, that sums things up pretty nicely.


Karen

I'm from the UK and spent 6 months living and working in Mexico City last year - what an amazing experience it was. The people are wonderful and the culture and history are facinating. I think it's a very under-rated country - most people just think of Cancun or Los Cabos when they think of Mexico, but there's so much to see and do just in DF alone, nevermind the rest of the country. My advice would go soon before too many people figure out how great it is! The pollution wasn't anywhere near as bad as I expected.

Enrique

Glad you liked our city and want to return.

If you are here for a bit longer you'll probably discover that it is one of the most formidable laboratories for economists interested in freakonomical topics. Examples:

1) How street sidewalks and subway stations are auctioned off to street vendors according to value, traffic and political connections.
2) Abortion in Mexico City was legalized last year. Will crime decrease in the future?
3) Arbitrage opportunities and rent-seeking by policemen imposing traffic fines.

I'm sure studying our stock exchange is interesting but there are 1000 other areas of study that deserve attention here.

Silvanus

Regarding the lack of large signs phenomenon-

Large signs promoting products were a phenomenon of fast food eateries in the 1950s, so that motorists on the new freeways and interstates could see the the logo. It became a bit of a competition to see who had the largest sign. This is documented in Fast Food Nation by Eric Schlosser. Since fast food and gas stations were very near, it doesn't surprise me that American gas stations have huge signs.

Regarding the gasoline vs ethanol observation. Mexico doesn't grow sugarcane in the same proportions as Brazil. Mexico is instead a major petroleum exporter to the United States. That should tell you something : P

But yes, Mexico City is an interesting megalopolis. You met with the elites of Mexico City. I'd be interested in your experiences had you visited with some of the working classes.

MoeZoo

hmm the intersection of Descartes and Victor Hugo. I wonder if philosophically speaking that's a sustainable state of mind. Any french scholars can comment?

MM

That is the fountain at the Camino Real Hotel. It is very much in the Luis Barragan style, the famed Mexican architect, but it was in fact designed by one of his students.
http://www.pritzkerprize.com/barragan.htm

Dawson Lemus

The reason they don't advertise the price of gas in gas stations is because it's the same in every single station. They are all controlled by the mexican government company, PEMEX.

Gabriel

Gas prices in Mexico are the same in every gas station (except on the border with the US). So, why would you advertise it? The only ways to compete in that market are through service and location.

Brian

Here's some things that I know about Mexico City from friends who grew up there:

At one point, in order to combat traffic (which is terrible) and pollution, the govt made people get stickers on their cars, and they were only allowed to drive on certain days with their stickers. Rich people ended up getting extra cars.

Next, the traffic is so bad, that people sometimes hop onto the highway and rob people through their windows. I saw this happen only a few cars in front of my one day (of the 2 days that I was there). What the police say to do is press the gas and create an accident--so people look at the guy.

Also, I believe the Mexico City is one of the most polluted cities in the world. Not sure if that's true, or just a rumor.

Monk

"Large signs promoting products were a phenomenon of fast food eateries in the 1950s, so that motorists on the new freeways and interstates could see the the logo. It became a bit of a competition to see who had the largest sign. This is documented in Fast Food Nation by Eric Schlosser. Since fast food and gas stations were very near, it doesn't surprise me that American gas stations have huge signs."

Flawless logic.

Mario

I am a mexican undergraduate student in the US and I am very glad that you can't wait to return, and not only to Mexico City, but more traditional places (Guanajuato, Guadalajara) or more modern ones (Monterrey).
And yeah, gas prices are the same everywhere since the oil industry in Mexico is nationalized; it is usually a hot debated topic during election time as all the candidates usually have to express their views on this issue.

Some aerial pictures from Mexico City can be found here:
http://homepage.mac.com/helipilot/PhotoAlbum31.html

Alfonso Gutierrez

I'm glad you liked our city! We're trying very hard to improve the quality of life here. Make sure you visit the National Unviersity and the Museum of Anthropology next time you're around.

The traffic issue is far worse here than your picture shows. I'm reading Tim Hardford's "Undercover Economist" and he proposes taxing the use of roads as a solutions to this problem. Yet the rich are so rich here that it wouldn't harm them; and the poor are so poor that they wouldn't care. There is a growing number of us stuck in the middle though. We have to choose between spending an average 4 hours a day riding the buses and trains of our inefficient and insufficient public transport system or buying a car only to be stuck in traffic for pretty much the same time.

Do you know of any cities where this taxing system has been successful(other than Hartford's London example) or of any other systems that have been used to decrease traffic? We waste millions ($) when our people just sit around commuting!

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Mario

oh, and I have been to Mexico City only once and stayed at the Camino Real as well…I love the fountain too!

coolrepublica

"the people I spoke with (especially the university students) were smart and incredibly energetic"

I am still laughing from reading this comment. All I could think about when I read this was: is this the freakonomics version of "you're so articulate for a black man."

It almost sounds as if Stephen was surprised that the university students in Mexico were smart and energetic.

And Yes, I do know that he did not mean it like that. It just sounded like it.

Patrick

I've been in Buenos Aires a week now and I'm feeling and seeing a lot of the same things that you've seen in Mexico. Too bad the classic neo-liberal model of gradually extended growth isn't sustainable now that global oil production has peaked. In Argentina's case, they could have made some different political and economic turns in the 20th century and become as potent a nation as India or Brazil is today, its a shame; culturally this place is like the USA of the south.

Abel M.

The gas stations are all PEMEX franchises; they are independently owned, but all sell the same PEMEX-supplied gasoline and optionally diesel. The price per liter is set by the government and changes on a monthly basis (always upward, from my experience). They are all "full-service" stations, although the service is minimal. It consists mainly of the fueling proper, and maybe wiping front and optionally the back windshield. However, this is done more to increase the amount of the expected tip than as a courtesy. Attendants are poorly paid and supplement their income by the tips. Though you'd think this would make them really try hard, it seems that everyone hands out at least a token peso, so maybe they're not really all that motivated to provide great service.

Most PEMEX franchisees are companies that own a number of stations. Some of them offer offer raffle tickets per amount of spend (say, one ticket per $50 MXN) as an additional differentiator to increase sales. The prizes normally are cars.

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Sp

Glad you came to our country. Welcome any time. If in some other occasion you plan to go to Monterrey, please tell in advance.

Maybe the Monterrey "International Cultural Forum" is a good motive to come.

http://www.monterreyforum2007.org/index.php?lang=en

SB

Your "the people I spoke with were smart" just rubs me the wrong way. But... I'll let it go... like somebody said, I'm sure you didn't mean it that way...

Gas prices are not posted because they are all the same. There is only one gas provider in Mexico: PEMEX - so there's no need to market your prices to attract customers... people have no choice... (and I see more people commented on this already).

Your fountain picture was very cool... And yes, Monterrey also has museums and buildings designed with that style (Luis Barragan I think)... bright colors, super cool.

Glad you enjoyed Mexico - definitely go back! Check out the pyramids...

MM

@coolrepublica

There is probably some research somewhere that shows that people who live closer to the equator have less energy, due to the effect of the sun. People make fun of the siesta but it is a perfect remedy for that. I think it is appropriate that Stephen would express surprise. It is not an ethnic or racial point, it is the climate that does it and would do it to anyone who moves there.

jose

I heard that the subway system in Mexico City was pretty good.

MarkieP

I have visited Mexico several times, Mexico City (DF) twice. I love Mexico. It is a world of its own, great music, great art, great people.

If you have some time (even a few weeks), you might consider a language-immersion school and stay with a host family. It is something you can do with your children too. Learn, talk, have a Paloma.

I have to agree with coolrepublica's comment on the "smart" college students though. That could be taken the wrong way. Although what you may have meant was that they were smart compared to many of our college students. On average, I would bet a dollar they are.