Market Sensitivity of U.S. And Mexican Border Travel

Abstract

This article explores the reaction of Mexican-U.S. border travel expenditures to movements in the Mexican and U.S. cost ofliving index and the peso-dollar exchange rate. Border travel patterns between 1970 and 1985 are studied by converting expenditures to real dollars using an interrelationship among these three variables. The Mexican government's devaluations of the peso between 1976 and 1985 improved Mexico's border travel balance.