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  • The Chiapas Puzzle

    For the twenty years following the Zapatista uprising (1994-2013), the federal government had placed a lot of resources and policy attention in an effort to reduce the large income gaps between Chiapas and the rest of Mexico. Public investment in schools, hospitals, and conditional cash transfer programs had been implemented, resulting in a significant improvement that did reduce the gap in terms of educational and health outcomes. Massive infrastructure projects had been undertaken to upgrade Chiapas' roads, ports and airports, boosting the connectivity of the state with markets within the state and elsewhere in Mexico. And yet, twenty years later the income gap between workers in Chiapas and the rest of Mexico had deepened, and Chiapas remains the poorest state in Mexico, with three quarters of its population poor and close to half in extreme poverty. Large productivity gaps - as proxied by wages - are not only observed between states, but have also expanded dramatically within the three sectors employing two-¬thirds of the workers in Chiapas: Agriculture, wholesale and retail, and manufacturing. One year into his term as Finance Minister for the government of Enrique Peña Nieto (2013-2018), Luis Videgaray ponders the statistical evidence available and baffles at the puzzle. The case includes a series of videos featuring Luis Videgaray, Mexico's former Secretary of Finance and Public Credit (2012-2016). In the first video, "The Chiapas Puzzle" (7:41 min.), to be viewed by students in preparation for the class, Mr. Videgaray explains the situation in Chiapas and the dilemmas he and the Mexican Government faced early on. The other three videos, "The Case of Yazaki" (3:55 min.), "Infrastructure and Political Economy" (4:19 min.), and "Takeaways" (5:03 min.) can be played as part of the class discussion. A supplemental slide set is also included with this case.
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  • Target of Opportunity: South Africa's Western Cape Seeks a Role in the African Oil Boom

    This strategy case describes an initiative in the Western Cape province of South Africa to capitalize on an oil boom off the western coast of Africa by cultivating an industrial "cluster" of complementary businesses with the capacity to service, repair, and build components for oil and gas drilling vessels and equipment. The first half of the case lays out the initial thinking, planning, and strategizing. It includes the motive for launching the initiative, reasons to think the Western Cape was well-positioned to make a success of it, and anticipated obstacles. The second half summarizes the first ten years of the initiative, in which a string of difficulties-some foreseen, some not-severely limits the initiative's progress. This includes a shift in priorities in the National Ports Authority, a problematic deal for making port infrastructure improvements, and some features of local corporate culture. The case ends with reflections from two of the initiative's biggest advocates, predicting that new political developments and a possible shift in strategic approach will allow the effort better success in the coming years. Case Number 2002.0
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