Tag Archives: economics

March 2022

Mexico – The Money Tells Its Story

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By Julie Etra

In this part of southern Mexico, paper money – all issued by the central Banco de México – is colloquially known as lana, billete(s) or biyuyo. Change in coins is called moneda throughout Mexico, and locally you might hear chincastle and morraya.

I had often wondered about the historical figures portrayed on Mexican paper currency and their significance, as well as the landscapes and images on the opposite side of various denominations. Typically, one side commemorates an aspect of Mexican culture and prominent historical figures, with landscapes and flora and fauna featured on the reverse side. Mexican paper money is indeed artistic, colorful, beautiful, and instructive, so I’ve written about this in The Eye before (March 2019). But it’s been changed again, so here’s an update!

The $1,000 Peso Bill

This past November (2021) a new 1,000-peso bill was issued, although it is not widely circulated. Unlike its predecessors, it is printed on a plastic polymer. Honoring the Mexican Revolution on one side in multi -hues of teal and yellow are portraits of Francisco I. Madero, Carmen Serdán and Hermila Galindo in the foreground, while a steam locomotive, the modern transportation of the day, provides the background.

Madero was Mexico’s 37th president (1911-13) and a prominent leader in the history of the Mexican Revolution (1910-20). He pushed for the ouster of Porfirio Díaz, the self-declared President for Life who had ruled off and on from 1876 to 1911. Although well-educated and from a wealthy family, Madero advocated for the social reforms that fomented the Revolution. He was assassinated during a right-wing military coup.

María del Carmen Serdán Alatriste took on organizing the logistics of Madero’s anti-reelection movement in the state of Puebla. She maintained and protected the family household in the city of Puebla, where the first armed battle of the revolution took place. Carmen and her sister had smuggled guns in their clothing into their house to support the anti-reelection battle, set for November 20; supporters of Porfirio Díaz discovered the conspiracy on November 18 and attacked the house. You can visit the ensuing bullet holes in what is now Museo Regional de la Revolución Mexicana, Casa de los Hermanos Serdán. at 6 Oriente 6 in the historical center of Puebla.

Hermila Galindo Acosta was a well-educated and outspoken feminist and advocate for women’s rights. She was a supporter of Venustiano Carranza and became his personal Secretary, among other titles and responsibilities. Carranza, after a complicated series of power plays and internal dissent, became President for three years after the assassination of Madero. He supported Galina and helped her efforts, including the 1915-16 publication of the review La Mujer Moderna (The Modern Woman).

The reverse side features the tropical wetland ecosystem of the Calakmul Reserve in the State of Campeche, Mayan ruins, and the endemic jaguar.

The $20 Peso Bill

The new pink and green 20-peso bill (which was supposed to be replaced by coins) was released on September 24, 2021, and on the horizontal side depicts the “Solemn and peaceful entry of the Army of the Three Guarantees to Mexico City on September 27 of the memorable year of 1821 and Consummation of the Independence of Mexico’ (the original artist is unknown). Also called the Ejérciito Trigarante, this newly formed unified (albeit briefly) army comprised Spanish troops led by Agustín de Iturbide and Mexican insurgent troops led by Vicente Guerrero. (Guerrero later became Mexico’s second president – for less than a year; he was betrayed and brought to Bahía de Entrega, one of the beautiful bays of Huatulco, then transported to Oaxaca City where he was executed.)

The opposite, vertical side celebrates Mexican coastal mangrove ecosystems, the Mexican crocodile, and the roseate spoonbill, portrayed at the Sian Ka’an Biosphere wetland preserve in the Yucatán state of Quintana Roo (mangroves, crocodiles and roseate spoonbills also inhabit the Pacific coast).

The $50 Peso Bill

Issued on October 28. 2021, the beautiful new 50-peso bill was printed on a polymer instead of paper and is predominantly mauve-purple in color. It is very complex, in part to eliminate counterfeiting. The images are vertically oriented on both sides of the bill; security features include areas on the bill that feel different to the touch, and areas that change color when you tilt the bill.

The bill was designed to honor both Mexico’s pre-Hispanic history and its diverse natural history.

On the mainly historical side, the primary motif in the foreground shows an eagle perched on a prickly-pear cactus holding the atl-tlachinolli (the Aztec symbol for “water-fire,” representing war as sacred; this motif is a bas-relief carving on the back of the monolith called El Teocalli de la Guerra Sagrada (the Temple – teocalli is Nahuatl for “temple” – of the Sacred War). The monolith was discovered in 1831 in the foundations of what is now the National Palace of Mexico in Mexico City, which was originally built with the remains of preceding Aztec architecture. The temple/throne has been moved to the National Museum of Anthropology in Chapultepec Park.

The monolith is a scale model of an Aztec temple, and could have been created as early as 1200; however, it is also thought to have been commissioned as a throne by Moctezuma II, the Aztec ruler defeated in the conquest, which would put its origins in the early 1500s. Archeologist Alfonso Corso, in a journal article from 1927, gave the piece its name, and hypothesized that the depiction of the eagle “justified human sacrifice and warranted warfare” as a way to collect prisoners for sacrifice.

In the background of the eagle depiction, a representation of the city of Tenochtitlán appears. The eagle depiction bears a striking resemblance to the national coat of arms that appears on the Mexican flag, except the “water-fire-war” object has been replaced by a snake. While no one quite knows why, some historians suggest that Spanish efforts to remove indigenous symbols led to the eagle capturing the snake. the city of Tenochtitlán appears; it is based on a portion of the 1945 mural by Diego Rivera, The Great City of Tenochtitlán, in the National Palace. The top of the bill shows the symbol for ollin (Nahuatl for “movement” – this ollin may represent the four movements of the annual course of the sun); there is a small “50” atop the symbol, as well as in each corner of the bill.

Although the Rivera mural shows some natural heritage – Mexico’s famous twin volcanoes, Popocatépetl and Iztaccihuatl, the central image on the reverse of the bill is the Mexican axolotl, an endemic salamander endangered due to loss of habitat, urban encroachment, pollution, and predation. The remaining axolotls are now confined to Lago Xochimilco, the remnant “lake” of the former basin of México and the name given to the southern Mexico City neighborhood where Aztec canals connected the neighborhoods of Tenochtitlán and provided access to chinampas, artificial agricultural plots for growing produce and flowers.

Not to be confused with other salamander species in this genus, often dubbed “axolotls” as well, the scientific name of this particular axolotl is Ambystoma mexicanum. Named after the Aztec god of fire and lightning, Xolotl, the axolotl, aka ajolote in Spanish, has been important in Mexican culture for centuries. It was important in the diet of pre-Hispanic residents of the city of Tenochtitlan and especially the Xochimiltecos (No thanks! But they still turn up in real tamales, check the February 2022 issue of The Eye).

Although native to the system of lakes that comprised the basin, axolotls were particularly prevalent in the Chalco-Xochimilco sub-basin, because it was less brackish than the other three basins. This huge, up-to-a-foot-long salamander is unusual in that its final metamorphic stage is not completed, and its gills remain outside its body. It is sexually mature in the larval stage. Even more unusual is its ability to regenerate limbs, hearts, spinal cords, and even part of their brains, so this odd-looking animal holds huge medical and scientific significance.

On the 50-peso bill, the ajolote is surrounded by chinampas, where corn – perhaps Mexico’s most resonant cultural symbol – is shown being cultivated. The trees shown growing on the edges of the chinampas are ahuejote trees (Salix bonplandiana), an erect willow resembling a poplar. (Ahuejote comes from the Nahuatl words atl, or “water” and huexotl, or “willow.”)

The $100 Peso Bill

A new 100-peso bill was issued on November 12, 2020. The bill is slightly larger than the new 20-peso bill. What a concept! Different sizes for different denominations. The images are vertically oriented on both sides, with hues dominated by pink and turquoise. Doña Inés de Asbaje y Ramírez de Santillana, better known as Sor Juana, a scholar, philosopher, and poet, is represented on one side. Born in 1648 on what is now the outskirts of Mexico City, she was raised by her wealthy criolla (Spanish, but born in Mexico) mother. Her intelligence and insatiable curiosity were recognized at a very young age, and she self-educated herself in the family library. Even girls of her economic stature and recognized capabilities were denied any formal education, typical for the era. Sor translates as “nun”, which she became in order to escape the confines and expectations of marriage, and to continue her studies and writings. She was considered a “proto feminist,” arguing for women’s education, and she risked being censured by the church for her outspokenness. For a more thorough description of this incredibly progressive woman, please see The Eye, “The Tenth Muse,” September 2013.

The temperate forests of the states of México and Michoacán de Ocampo, home to the Monarch Butterfly reserve, are featured on the other side. The butterfly is shown feeding on the nectar of a milkweed plant (Asclepias sp.), a symbiotic relationship essential for both the pollination of the plant and the reproduction of the Monarch. Loss of habitat and associated milkweed plants is the dominant reason for decline of this butterfly. In the background are oak-pine woodlands.

The $200 Peso Bill

In 2019 the Bank of Mexico issued the new 200-peso bill depicting Miguel Hidalgo y Costilla, the parish priest known as the Father of the Homeland, and José María Morelos y Pavón, known as “Servant of the Nation,” in commemoration of Mexico’s Independence. Pavón was also a Catholic priest and a revolutionary leader in the war of independence, who assumed leadership after Miguel Hidalgo y Castilla was executed.

To their left is La Campana de Dolores (the Bell of Dolores). The bell was rung at dawn on September 16, 1810, in the town of Dolores, Guanajuato, Mexico (known as the “Cradle of National Independence”), calling the population to rebel against the authorities of the Viceroyalty of New Spain. The grito (shout) made by the parish priest, along with Ignacio Allende, a captain in the Spanish army who sympathized with independence, is known as the Grito de Dolores. Every year on September 15, the Mexican president rings the bell, which has been relocated to the central balcony of the National Palace in Mexico City, to commemorate the grito.

On the upper right side, the denomination 200 is multi-colored as it changes between blue and green depending on inclination and lighting. The bill is also friendly to the blind, containing tactile, three-dimensional lines. The opposite side of the bill celebrates desert ecosystems, represented by a golden eagle soaring over the El Pinacate Biosphere Reserve in the state of Sonora.

The $500 Peso Bill
In August 2018, a new blue 500-peso billete was issued, supposedly to fight counterfeit bills (one often sees checkout clerks inspecting 500-peso notes). Both front and back images are horizontally oriented. One side portrays Benito Juárez, the 26th president of Mexico, accompanied by an image of his triumphal arrival at Mexico City on July 15, 1867, symbolizing the victory of the Reformation, the separation of Church and State and the basic principle of equality before the law. Benito Juárez came from Oaxaca, and is Mexico’s only completely indigenous president (Vicente Guerrero’s father was of mixed Afro-Mexican and indigenous descent).

The opposite side of the bill features a ballena gris (gray whale) and her calf, representing the coasts, seas, and islands of Mexico’s varied marine worlds, and specifically the El Vizcaino Biosphere Reserve in Baja California Sur, a World Heritage Site.

2021, April 2021

Brideprice in a Zapotec Village: Evolving Economic Theory?

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By Alvin Starkman, M.A., J.D.

Twenty-six turkeys on the ground, their feet tied. Cases of beer and soda stacked behind along with the rest of the brideprice for Paola and Javier’s wedding. Everything is arranged in an orderly fashion, easy to count, then loaded onto a pick-up at the modest homestead of Javier’s family, just hours after the wedding ceremony. It’s all waiting to be driven to Paola’s parents’ expansive home located on a hill overlooking a cluster of residences, a church, and municipal offices in San Bartolomé Quialana, an ethnically Zapotec village of roughly 2,500 inhabitants, under an hour from the city of Oaxaca.

While the tradition of paying brideprice is waning in parts of Mexico, it continues in Quialana. Brideprice is the transfer of currency or non-monetary equivalent from the groom or his family to the bride’s family. However, the circumstances of the courtship and marriage of Paola and Javier challenge traditional theory concerning the relationship of brideprice to the bride’s service to the groom’s family, to reproduction, and to the economic marketplace – unless one considers that the bride is an American citizen, and a minor.

Virtually all family members in the agricultural community of Quialana are involved to some extent in growing crops. Animal husbandry consists of raising mainly poultry for personal consumption, as well as turkeys, goats, and sheep for a small local commercial market. Underpinning the foregoing are well-entrenched traditions of making terra cotta pottery, the pre-Hispanic drink tejate, and hand-made tortillas, all sold in nearby Tlacolula de Matamoros, noted for its vibrant Sunday market.

Quialana is a matrifocal village, with a conspicuous absence of males except for youth and the elderly. Because of an essentially subsistence economy, and the allure of the United States, emigration is common, especially for males in their teens and twenties.

Mainly men tend the goats and sheep, as well as do most heavy agricultural work such as plowing. But women keep the economy alive: planting, weeding, and harvesting; making tortillas and tejate; producing pottery including excavating the hard clay from the base of nearby foothills; and selling in marketplaces.

Women cook, clean, and wash. At a very young age they are taught to become efficient at household chores, being groomed for marriage in their teens. A young woman who has been taught well by her mother is highly marketable. Arranged marriages are still commonplace.

Marriage is extremely important. At a minimum, state sanctioned nuptials legitimize what would otherwise simply be child-bearing out of wedlock, accepted but not rejoiced. At times, a couple will marry with a small civic ceremony, deferring the Catholic mass followed by multi-day festivities until their families can afford the latter. If under 18 years old, the couple must submit parental consent to marry.

Monogamy is valued and practiced. While extra-marital liaisons are much more commonplace throughout Mexico than in the United States and Canada, and in fact wives often accept a husband’s infidelity, it is likely that in Quialana men remain more or less faithful. Separation and divorce are uncommon.
Paola is 17, born and raised in Texas. Her parents are from Quialana, although they moved to the United States 28 years ago, shortly after marrying. They have four children; married sons aged 29 and 23, and daughters 21 and 17.

Both parents completed public school in their village, with no further education. After leaving school they became campesinos (agricultural workers) until moving to the US, although the mother became a housewife prior to giving birth to her first child. They own both their Texas and their village homes.
The father is a construction worker in the United States, while the mother has been a homemaker throughout virtually all of the marriage. Depending on the length of the family’s visits to Oaxaca, the father may work in the fields.

Roughly every two years Paola had been traveling to Quialana with her parents to visit family. By the time she moved to Oaxaca she was close to completing grade 12, with teaching her career goal.

Javier is 20. Quialana is his life. He only infrequently travels to Oaxaca, and has never left the state. He dropped out of high school. He’s a campesino. He lives with his sister, who is 16 and in high school, and his mother and aunt who both work in the fields and make pottery and tejate which they sell in Tlacolula.

When Paola’s oldest brother married, her parents paid a brideprice. When her second brother married, they did not, because it was only a civil ceremony. Her brothers and sister live in Texas.

Paola and Javier became acquainted via the internet, then met face-to-face when she turned 15 and was visiting Quialana. They began dating. When she was visiting over Christmas, 2014, just after she had turned 17, they decided to marry the following autumn.

The courtship and marriage was not arranged. In fact, Paola’s parents were upset with the couple’s decision to marry because of Paola’s age. Initially they did not want to consent. Although the intricacies of how the ultimate brideprice was determined is uncertain because of different perceptions and versions of the two sides, the threat of withholding consent and returning Paola to Texas played a role – as did Paola’s status as an American citizen.

Paola initially objected to her parents receiving brideprice, and felt she was being purchased like chattel. She eventually realized that it’s tradition. She now understands that if the groom’s family does not pay a mutually agreed amount, Javier would not be perceived as a quality husband. Both families earn the respect of other villagers if an accord is reached.

According to Paola, Javier’s mother initially offered 15 turkeys. It is customary to also pay an equal number of cases of beer, plus corn and sometimes other foodstuffs of lesser value. Elder church members became involved in the negotiations, one representing each family. Paola believes that her parents initially rejected accepting anything, because of her wishes. Javier’s mother claims that the number of turkeys grew to 26, and that the number of cases of beer reduced to 10, plus 10 cases of soda. If the number of turkeys is too large, then the quantity of beer should be reduced. The final brideprice was 26 turkeys, 10 cases of beer, 10 cases of soda, a fixed number of sacks of corn kernels, and perishables including aromatic herbs.

If Paola’s parents were initially predisposed to not accept anything, how did matters progress to the point wherein they demanded at least 26 turkeys and the rest? According to Paola that was what her parents needed to fulfill their gifting obligations to members of their extended families. On the other hand, Paola states that it was her parents who gave the couple large appliances, a wardrobe and other valuable gifts, whereas friends and family gave only relatively inexpensive household items such as pots, pans, dishes and blenders.

Brideprice-paying societies have been associated with a strong female role in agriculture. Because at marriage a bride generally moves into the household of her groom, brideprice is typically considered the payment a husband (and his family) owes to a bride’s parents for the right to her labor and reproductive capabilities. Brideprice has usually been a rather uniform amount throughout a society, linked directly to the number of rights which are transferred and not to the wealth level of families. It has also tended to correlate with polygyny and with the possibility of divorce. However, Paola and Javier’s situation poses a problem within the context of this explanation.

Javier had many prospective brides from whom to choose, given a plethora of young women in Quialana and nearby villages who had been readied for marriage by their mothers, and the effective absence of competition for him given the paucity of eligible males. “Marriage squeeze” refers to an imbalance between the numbers of marriageable men and women. With such a pool of young women, why in this case do we not see no marriage payment at all, or the beginning of a change from brideprice to dowry?

Where there is greater competition by men for wives, a “marriage matching framework” may explain a transition from brideprice to dowry as societies grow more complex. The frequency and magnitude of brideprice should be greater when wives’ input into production (like agriculture) is high and in societies with a significant incidence of polygyny. On its face, the case of Paola, Javier and their families does not accord with this approach.

Quialana is monogamous, and even within the context of widespread adultery in Mexico, this village does not appear to fit the mold. Furthermore, Paola had not been groomed for the rural Oaxaca marriage marketplace. It was only after wedding and moving into Javier’s family’s home that she truly began to learn household chores, from Javier’s mother and aunt. Months after the move she had still not gone into the fields to assist in farming. Her value as a housewife and agricultural worker had been unknown and untested prior to marriage, as compared with other village teens. Townspeople talk, and they know. Paola’s value cannot be understood as commensurate with the household labor she would contribute to Javier’s household. And while a bride’s value is often tied to her capacity to bear children, in this case there had been no prior suggestion that the couple would try to start a family immediately after the wedding, nor any discussion in regard to the couple’s ultimate family size. On the contrary, Paola’s childhood in the United States suggests, despite class considerations, the likelihood of a small family.

The most dramatic changes to marriage payments within societies are the times when payments have increased substantially, particularly in the value of a dowry. As compared to dowry transfers, little evidence exists of brideprice escalation in historical or contemporary societies. If we accept academic conjecture that modernization plays a role in decline and disappearance of marriage payments, then what specifically about modernization does this?

In this case the relatively exorbitant brideprice ultimately received provides a glimpse into the importance of age and citizenship as determinants of quantum of marriage payments. Furthermore, if this theory is correct, one might witness dramatic cultural change in which these two factors, US citizenship in particular, have the potential to govern payments – not only the amount, but also to and from which family the funds flow. In Quialana, the possibility thus exists for the tables to turn, with young, rural Zapotec men who are American citizens returning home and their families demanding dowry payments from the bride’s family.

Within this context, the amount of brideprice is consistent with at least some aspects of contemporary economic theory. While dowries seem to comprise a substantially larger portion of household income than brideprice, the latter are nevertheless significant. They can represent a large financial burden for poorer households, having implications for the distribution of wealth across families and generations.
There appears to be a correlation between marriage payments and the ability of prospective immigrants to move legally to the United States. Assuming that inter-country migration is one concomitant of modernization, we may find that modern arrangements actually see an increase in marriage payments as opposed to their disappearance.

Paola and Javier’s case may also provide an answer to whether brideprice influences the welfare of women. Both sexually and in terms of labor, brideprice has long been linked to domestic violence, owing to women’s fear of returning to their natal home without being able to repay the brideprice. If Javier uses his marriage to Paola to migrate legally to the United States, and thereafter embarks upon a “path to citizenship,” Paola retains the upper hand, insofar as Javier would, pending citizenship, have to be on his best behavior for fear of being deported in the face of any alleged domestic abuse.

Quialana is monogamous, and even within the context of widespread adultery in Mexico, this village does not appear to fit the mold. Furthermore, Paola had not been groomed for the rural Oaxaca marriage marketplace. It was only after wedding and moving into Javier’s family’s home that she truly began to learn household chores, from Javier’s mother and aunt. Months after the move she had still not gone into the fields to assist in farming. Her value as a housewife and agricultural worker had been unknown and untested prior to marriage, as compared with other village teens. Townspeople talk, and they know. Paola’s value cannot be understood as commensurate with the household labor she would contribute to Javier’s household. And while a bride’s value is often tied to her capacity to bear children, in this case there had been no prior suggestion that the couple would try to start a family immediately after the wedding, nor any discussion in regard to the couple’s ultimate family size. On the contrary, Paola’s childhood in the United States suggests, despite class considerations, the likelihood of a small family.

The most dramatic changes to marriage payments within societies are the times when payments have increased substantially, particularly in the value of a dowry. As compared to dowry transfers, little evidence exists of brideprice escalation in historical or contemporary societies. If we accept academic conjecture that modernization plays a role in decline and disappearance of marriage payments, then what specifically about modernization does this?

In this case the relatively exorbitant brideprice ultimately received provides a glimpse into the importance of age and citizenship as determinants of quantum of marriage payments. Furthermore, if this theory is correct, one might witness dramatic cultural change in which these two factors, US citizenship in particular, have the potential to govern payments – not only the amount, but also to and from which family the funds flow. In Quialana, the possibility thus exists for the tables to turn, with young, rural Zapotec men who are American citizens returning home and their families demanding dowry payments from the bride’s family.

Within this context, the amount of brideprice is consistent with at least some aspects of contemporary economic theory. While dowries seem to comprise a substantially larger portion of household income than brideprice, the latter are nevertheless significant. They can represent a large financial burden for poorer households, having implications for the distribution of wealth across families and generations.
There appears to be a correlation between marriage payments and the ability of prospective immigrants to move legally to the United States. Assuming that inter-country migration is one concomitant of modernization, we may find that modern arrangements actually see an increase in marriage payments as opposed to their disappearance.

Paola and Javier’s case may also provide an answer to whether brideprice influences the welfare of women. Both sexually and in terms of labor, brideprice has long been linked to domestic violence, owing to women’s fear of returning to their natal home without being able to repay the brideprice. If Javier uses his marriage to Paola to migrate legally to the United States, and thereafter embarks upon a “path to citizenship,” Paola retains the upper hand, insofar as Javier would, pending citizenship, have to be on his best behavior for fear of being deported in the face of any alleged domestic abuse.

If we consider that legal residency in the United States would provide Javier with an enhanced opportunity to repay the brideprice to his family in Quialana, we can work towards determining the value the brideprice has represented. Otherwise, there is an extremely tenuous connection between the cost of the brideprice and the ability of Paola’s services to provide a net gain to Javier’s family over the ensuing years. However, one must also recognize that one theory links marriage payments to the rights of inheritance held by women, and to this extent the payment by Javier’s family might make economic sense, arguably at a more indirect level.

The suggestion that marriage payments are correlated to the number of rights, should perhaps be adjusted to the value of one or more rights. On the other hand, this case does support the contention that the wealth of families involved has little to do with the amount of the payment. Take the example of Mexicans intent upon migrating to the United States without papers. A coyote (human trafficker of sorts) charges his clients based on the value he attributes to that service. Charging brideprice, or dowry for that matter, in certain contexts is valued in a similar fashion. That is, these individuals charge a fixed fee to assist Mexicans to illegally cross the border without regard to their financial circumstances, just as parents of brides may attribute a value to the permission to marry their daughters without regard to the ability of the groom or his family to pay.

Most economic explanations for brideprice are based on notions of supply and demand in the marriage market. But many such elucidations are weakly convincing, and puzzles remain. Indian research has focused mainly on dowry and brideprice separately, ignoring the possibility of a “joint determination.” However one academic study analyzed dowry and brideprice as “interdependent institutions,” taking into consideration factors such as education, age, and distance of marriage migration.

The case of Paola and Javier illustrates the potential for developing a broader model for determining and evaluating similar factors at play regarding marriage payments in contemporary society where migration exists. This is not to totally discount Paola’s explanation that the lofty payment her parents received indicates that they respect and value Javier as a son-in-law.

The general application may be limited to contexts of high emigration, especially involving countries where citizens are able to sponsor a spouse for legal immigration. Age and other factors must also be considered. This approach leads us away from the static traditional notion of there being either brideprice or dowry. Driven by more modern considerations, payments might increase, decrease, or dissipate completely. In any event, thinking about Paola and Javier expands our understanding of the legal issue of “quantum meruit,” or the determination of how much something is worth.

This article has been adapted from an earlier academic paper by the author. Alvin Starkman operates Mezcal Educational Excursions of Oaxaca (www.mezcaleducationaltours.com).

2021, March 2021

Microenterprise in Mexico: Building Women’s Businesses

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By Deborah Van Hoewyk

In 1976, amidst crushing poverty on the other side of the world, an idea popped up. Muhammad Yunus, born into the British Raj in 1940 in what is now Bangladesh, was an economist with a crazy-quilt professional background. An academic, a social activist, a banker, and more, Yunus went out one day to visit the poorest households in rural Bangladesh. He found women making bamboo furniture; to buy the bamboo, they took out money-lender loans, but the interest rates were so high, the women earned practically nothing, despite all their work.

Lending to the “Unbanked” – and to Women

As a banker, Yunus knew that conventional banks would not make tiny loans at reasonable interest rates to the bamboo workers – the banks did not believe these people capable of paying back a loan.

Enter the idea, and what an idea it was! Microcredit – tiny loans for tiny businesses started by people so poor they’d never even been inside a bank. Yunus adapted the idea of lending circles – groups of women were issued the loan, picked the recipient out of the group, and members supported her in making sure her business did well enough to pay it back. Then it was someone else’s turn.

Over the next six years, Yunus would reach 28,000 microenterprise borrowers; the program became the Grameen Bank (“village bank”). Together, Yunus and the Grameen Bank were awarded the Nobel Peace Prize in 2006. The idea swept the social and academic world of poverty alleviation – microenterprise development was an innovative, sustainable path out of poverty. Today, 97% of Grameen borrowers are women; the repayment rate is 99.6%.

Why women? To Yunus, it was obvious that poverty inflicts greater stress on women, and when women make money they spend it first on their business, then on their families, and finally on their future. Pro Mujer is a U.S.-based women’s development organization that works throughout Latin America; in Mexico, it operates from Mexico City east to the state of Veracruz. Their research shows that Mexican women reinvest 90% of their income in their families and communities. Men? A measly 40%.

Born in the U.S.A., Bred in Latin America

Back on this side of the world, an organization called ACCIÓN International took shape fifteen years before Yunus came upon the bamboo furniture makers of Bangladesh. In the late 1950s, jumping the gun a bit on President Kennedy’s Peace Corps, a Berkeley law student named Joseph Blatchford undertook a thirty-stop goodwill tour involving tennis (he was an ace) and jazz, meeting with youth across South America in an effort to create cross-cultural understanding. He set up a volunteer “Youth Force” dedicated to international service in 1961, establishing ACCIÓN International in 22 barrios across Venezuela.

With the philosophy of listening to what local communities wanted to do, Acción volunteers helped build schools and water systems and health centers, giving people the tools they needed to help themselves. The United States Peace Corps started doing the same thing by the end of 1961; after eight years of expanding ACCIÓN International beyond Venezuela to Peru and Brazil, Blatchford went home and became Director of the Peace Corps. ACCIÓN International became just Accion and started focusing on microlending. In less than five years, Accion’s program in Recife, Brazil, made 885 small loans; those businesses employed 1,386 people.

Based in Cambridge, Massachusetts, Accion began to build a network of financial institutions willing to lend to the poor. The great majority of microlending is conducted through the lending-circle model (now also called a “communal bank”). The networking strategy allowed Accion to expand its microfinance programs to 14 Latin American countries – Mexico among them.

In Mexico, Banco Compartamos (the “We Share” bank) opened its doors in 1990, and Accion invested. Accion also partners with CrediConfia in east central Mexico (Mexico City and the states of Mexico, Hidalgo, Puebla, and Michoacán), as well as the online microfinance platform Konfio, which started up in 2016. There are branches of Banco Compartamos in the Huatulco area in Chahue, Santa María, and Pochutla. Moreover, Oaxaca is almost unique among Mexican states in having a growing universe of credit unions (casas de ahorro, caja popular), often located in remote locations and quite willing to set up lending-circle-type financing. The biggest credit union, Caja Popular Mexicana, has branches in La Crucecita and Santa María.

The Microfinance – Microenterprise Development Connection

Mexican statistics indicate that very large businesses (over 250 employees) make up less than 1% of all Mexican businesses. The remaining 99% comprises medium (51-250 employees), small (11-50), and micro (1-10) businesses. The microenterprises are about 94% of all businesses and provide half of all the jobs in Mexico.

What does it take for a woman to get started on her own business? Here we should note that microfinance and microenterprise development are not the same. Microfinance provides a key tool for business expansion – without money, even if a business owner only needs enough money to stock 20 more scarves in her shop, there is no growth. Starting up a microenterprise is something else entirely. Like poor women everywhere, Mexican women face institutional barriers to getting financing, and the pathways to education and training are often blocked. But they also face cultural barriers.

Gender discrimination in Mexico is far more explicit (and can be extreme, see the article “Hits, Blows and Coffins,” on page 18 in this issue) than in other countries. Sociologist Gina Zabludovsky Kuper, from the National Autonomous University of Mexico (UNAM), researches gender and power, and has written extensively about women as entrepreneurs and executives. In terms of microbusinesses, Zabludovsky Kuper points out that there’s a cultural perception about “women who start microbusiness in order to contribute to the family economy or get out of poverty” – they have to stay at the micro level because “their work is only viewed as auxiliary”; the women themselves often buy into the notion that just being a sideline business “is what is reasonable for them.”

Microenterprise – Making It Work

Nonetheless, in some places in Mexico, the programs to train and encourage women do come together with microfinance institutions, and women-owned microenterprises do start up and succeed.
The Mexico City nonprofit Crea Communidades de Emprendadores Sociales is typical of a microenterprise development organization. It offers programs to empower women entrepreneurs with training in business skills, technical assistance, and business support; it also brings participants into a support network for each other. It serves central Mexico (CDMX, and the states of Mexico, Aquascalientes, Guanajuato, and Querétaro), offering online services across the country as well.

From 2002 to 2006, the W.K. Kellogg Foundation in Michigan funded a program in Oaxaca called Yo Quiero, Yo Puedo … Empezar Mi Propio Negocio (I Want to, I Can … Start My Own Business). Yo Quiero arose out of a women’s health initiative founded in 1985, added life-skills training in 1990, and started Yo Quiero, Yo Puedo as a school-based self-efficacy intervention in 1996. With Kellogg Funding, the microenterprise program served 600 rural women, started 17 bancos communal and 300 women-owned businesses, and had a 100% loan repayment rate. It included training 25 “social promoters,” who continue to run the program in Oaxaca, and have added a youth microentprise program that serves Oaxaca, Puebla, and Michoacán.

South of Oaxaca City, Villa de Zaachila is the site of the largest landfill in the state. A project named Mujeres A.V.E. supports solidarity networks for women to help them start and grow microenterprises that support their families and contribute to the community. Organized by the SiKanda Foundation (Oaxaca) and supported by the British Cherie Blair Foundation for Women, among others, Mujeres A.V.E. helped 45 women build the skills to strengthen their businesses and access new markets in its first year of operation (2018).

See for Yourself in Oaxaca!

There’s a new way to learn about Mexican microenterprise – visit one. Independent women micro-entrepreneurs, along with long-standing family businesses, abound in the craft towns around the state capital, Oaxaca de Juárez, and at least a couple of travel companies will arrange a tour for you.

The online Spanish travel company Authenticities (www.authenticitys.com) has a tour specifically focused on the entrepreurial women artisans – weavers, chicken-raisers, flower-growers, tamale-makers, potters – who participate in a micro-finance program to which Authenticities contributes.

Fundación en Via, which itself runs microfinance and microenterprise developments programs (https://www.envia.org/microfinance-tours), takes you to visit microenterprises where the owner is ready for her next En Via loan. The tour takes nearly all day, visits two communities, and gives the owners the chance to show you what they do and explain how previous and upcoming loans have helped build their businesses.