2 SOCIAL SCIENTIST
transfers within the developing world that this permitted and, above all, on the social, political and economic fall out of these developments in both the emigration and host countries. Besides distorting social structures, adversely affecting the process of nation building and working against the emancipation of women, they also set off processes that render the process of adjustment to reduced oil revenues and migration possibilities extremely difficult.
These kinds of problems operate also in countries which, through a strategy of import substituting industrialization, have built up a diverse and relatively large industrial base. A typical example is Mexico, which went through with an ISI strategy, and garnered substantial gains in terms of rates of growth, but soon ran into bottlenecks emerging from the constraints set by asset and income inequality on the pace of growth of agriculture and the rate of expansion of the domestic market. Further, successful import substitution notwithstanding, the structure of demand was such that imports always outpaced exports leading to severe balance of payments difficulties. Mexico attempted to ride these twin problems by exploiting the advantage provided by the oil price hike and launching on an exoport-led strategy. However, constraints operating in both international markets and internal supply structures, ensured that imports outpaced exports—a deficit which was financed by the easy access to international liquidity in the wake of the oil shocks. However, once oil prices collapsed, Mexico's ability to service its debts and ensure adequate capital inflows were eroded, necessitating the acceptance of an IMF type austerity package with extremely adverse growth and distributional implications.