This paper has three main objectives. The first is to review major changes in Mexico's agricultural policies in the context of trade liberalization. The second is to explore econometrically the impact of these policy changes on key variables of interest, including prices, trade, production and rural out-migration. The third is to illustrate the use of disaggregated policy modeling techniques to explore the sometimes paradoxical impacts of recent policy changes on Mexico's rural economies. After reviewing trends in the evolution of the rural economy of Mexico, including employment, land property rights and poverty, we suggest hypotheses to explain why some of the expected effects of NAFTA and agricultural reforms have not occurred. The paper ends with a reflection on the current political-economic situation in Mexico.


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