During the colonial era, many Native Americans and mestizos adopted the Spanish language and were converted to Roman Catholicism, the religion of the Spanish colonizers. This has provided the country with a greater religious and cultural homogeneity than might have been present otherwise. The vast majority of Mexicans, about 90 percent, are Catholic and speak Spanish. Nearly 8 percent of Mexicans continue to speak one of many Native American languages, the most common of which is Nahuatl. In recent years, Mexicans have moved in large numbers from rural to urban settings; in 1998, 74 percent of Mexicans resided in urban areas, with half of those citizens living in cities of 100,000 or more.

Mexico has a rich heritage in art and architecture and is recognized internationally for the contributions of its 20th-century mural artists, who created murals that reflected not only Mexico’s history and culture, but also its current social issues. Mexico’s blend of indigenous and European influences has affected many of its traditions and much of its culture. This ethnic heritage has contributed to the development of notable musical styles, folk art, and cuisine, all of which are also now found throughout the United States.

Mexico’s economic achievements are many, but the country continues to face many obstacles as it tries to further develop its economy. Political instability prevented significant economic growth for much of the 19th century. The Mexican Revolution, a major social upheaval in the second decade of the 20th century, further delayed Mexico’s economic expansion. Since World War II (1939-1945), the country has moved away from an agrarian-based economy; its economy now relies heavily on light manufacturing and exports. The country’s enormous petroleum reserves rank it among the top ten countries in the world. Mexico is a major exporter of crude oil and remains one of the top producers and exporters of silver, a mineral resource that has been important since colonial times. Although petroleum dominated the economy in the 1960s and 1970s, recent governments have encouraged economic diversification. Manufacturing, tourism, and assembly industries in northern Mexico are now important sectors of the economy. Mexico’s economy is also of major importance to the United States, not only because of formal links through economic agreements, such as the North American Free Trade Agreement (NAFTA), but also because Mexico is the third largest trading partner of the United States (after Canada and Japan). In turn, Mexico’s largest trading partner is the United States.

The history of Mexico revolves around the mixing of numerous cultural, ethnic, and political influences. These include contributions from several major indigenous civilizations, Spanish influences from the period of colonial rule, and a significant African heritage resulting from the slave trade of the early colonial era. Mexico’s postindependence period was characterized by violence and civil war, including European intervention and a long domestic dictatorship. The latter led to the Mexican Revolution (1910-1920)—the most important event in 20th-century Mexican history. This revolution would influence Mexican culture and politics for decades to come. Mexico’s political system emerged from this era and has provided political continuity from 1929 to the present, a record achieved by few other governments. Its political system is dominated by a strong president and executive branch, to the detriment of the judicial and legislative arms of government. The government is controlled by a single party, the Institutional Revolutionary Party, which dominated national elective offices in Mexico for most of the 20th century. While providing considerable stability, this political system has delayed Mexico from moving toward greater democracy, a pattern that most other Latin American nations followed in the 1980s and early 1990s.

Mexico’s most distinguishing physical feature is the central plateau, which runs from the northern border with the United States as far south as the Isthmus of Tehuantepec. The plateau is flanked by two major mountain ranges—the Sierra Madre Occidental in the west and the Sierra Madre Oriental in the east—that fall off sharply to narrow coastal plains. These ranges come together about 240 km (150 mi) southeast of Mexico City. Both have historically been major barriers to transportation between the central plateau and the coastal plains. The plateau generally ranges in elevation from about 900 m (about 3,000 ft) in the north to about 2,400 m (about 8,000 ft) in the south. Most of Mexico’s major peaks and inactive volcanoes are located on this plateau. These include Popocatépetl (5,452 m/17,887 ft) and Ixtaccíhuatl (5,286 m/17,343 ft), both of which are located near Mexico City, and the highest peak in Mexico, Pico de Orizaba (5,610 m/18,406 ft), located northwest of the Gulf Coast city of Veracruz. Many of Mexico’s major cities, including Mexico City, are located in smaller basins within the central plateau and are surrounded by mountains. The large basin where Mexico City is located has been known historically as the Valley of Mexico. As with California to the north, Mexico has frequent seismic activity, and earthquakes are fairly common in the capital city. In 1985 a major earthquake in Mexico City killed thousands and left nearly 30,000 homeless.

The Gulf Coast plain, which lies between the Sierra Madre Oriental and the Gulf of Mexico, is about 280 km (175 mi) wide at the border with Texas. It narrows to a width of just a few kilometers near Veracruz in the south, and then widens again at the Isthmus of Tehuantepec. The coast is characterized by swampy lowlands and numerous lagoons. The northern region is generally dry, and agriculture is possible only with the help of irrigation. Rainfall is more plentiful in the south, where there are tropical forests and some fertile farmland. The country’s most important port, Veracruz, is located in this region, which is also the site of many of Mexico’s petroleum discoveries.

The Southern Highlands, located south of the central plateau, are made up of a number of steep mountain ranges, deep valleys, and dry plateaus. The Sierra Madre del Sur range dominates this region, rising in the west near the mouth of the Balsas River. The range generally runs parallel to the Pacific coast until reaching the Gulf of Tehuantepec in the east; in many areas the mountains meet the sea, creating a rugged coastline. This scenic coastal region has become known as the Mexican Riviera and is the site of a number of coastal resort cities, including Acapulco and Puerto Vallarta. Inland valleys are hot and dry and support some irrigated agriculture.

South and east of the Isthmus of Tehuantepec, bordering Guatemala, are the Chiapas Highlands. Much of this region receives heavy rainfall and is covered by tropical forests. Some mountains in the Chiapas Highlands rise to more than 2,700 m (9,000 ft). Many of the residents of this sparsely populated area are Native Americans who work on subsistence farms or plantations.

In the far northwest of the country is the Baja California Peninsula. Stretching from the U.S. border southeast for 1,300 km (800 mi), the peninsula is extremely arid and mountainous, with a very narrow coastal plain. It is largely unpopulated, but has become increasingly attractive to U.S. tourists who visit coastal resorts along the northern Gulf of California and on the Pacific Ocean.

Some of the animals found in Central and South America—such as monkeys, tapirs, and jaguars—remain in parts of southern Mexico. This is especially true in the rain forests of Chiapas and the southern Pacific coast, where human settlement is sparse and population densities have remained relatively low compared to the northern regions of the country. As a consequence, more of the natural flora and fauna have survived in southern Mexico. The introduction of large numbers of domesticated animals in central and northern Mexico, as well as the density of human settlement, have considerably reduced the natural wildlife populations in these regions. However, bear, deer, coyote, peccary, and mountain lion remain in the rugged, mountainous regions of the Sierra Madre. Environmental groups have tried to protect Mexico’s endangered species, particularly marine turtles, from further exploitation and decline, but 36 bird species, 64 mammal species, 18 reptile species, 86 fish species, 40 invertebrates, and 3 amphibians have been deemed to be threatened in Mexico as of 1996.

Much of northwest Mexico—including Baja California and the northern regions of the Pacific Coast lowlands—is quite arid, receiving less than 130 mm (5 in) of rain per year. The northern Gulf Coast plains are semiarid, receiving about 250 to 560 mm (about 10 to 22 in) of rainfall annually. As on the central plateau, rainfall increases toward the south on both the western and eastern coasts.

The tropic of Cancer, which marks the northern limits of the tropics, passes through the southern tip of Baja California and crosses central Mexico. Much of southern Mexico has a tropical climate with distinct rainy and dry seasons; the Gulf Coast has more regular and abundant rainfall than the southern regions of the Pacific Coast. Temperatures in these coastal regions range between 21 and 27°C (70 and 80°F) during the year. Annual rainfall, which generally ranges between 1,500 and 2,000 mm (60 and 80 in), comes mainly during the rainy season of May to October. Mexico’s Gulf Coast is subject to hurricanes that pass through the region and often cause extensive damage.

The northern Yucatán Peninsula is hot and semiarid. Annual rainfall ranges between 500 and 1,000 mm (20 and 40 in). The extreme southern part of Mexico, including the Chiapas Highlands and the southern regions of the Yucatán Peninsula, is rainy and tropical. The climate in this region is generally hot and humid, with annual average temperatures of more than 24°C (75°F). Maximum precipitation occurs in summer, with average annual rainfall exceeding 2,030 mm (80 in) in some areas.

After World War II (1939-1945), which saw the beginning of a period of sustained industrial growth, Mexicans migrated rapidly from rural communities (under 2,500 population) to large urban centers. Many of these people moved to the Federal District, which includes the capital of Mexico City and was home to approximately one-fifth of Mexico’s citizens in 1997. During this postwar period the relatively unpopulated northern states also attracted numerous immigrants, as the economic base of frontier cities such as Ciudad Juárez and Monterrey grew rapidly.

After President Luis Echeverría Álvarez took office in 1970, he argued that rapid population growth would make it difficult for the government to generate positive rates of economic growth per capita. The Mexican economy had not been creating enough new jobs to provide all of its people with employment. The situation was made worse by the fact that an increasing portion of Mexico’s population was under the age of 16, and therefore dependent on the economically active population for support. Consequently, the government began providing family planning information and education. These efforts, complemented by private programs and the increasing levels of education that resulted from migration to urban areas, contributed to a significant decline in population growth rates. These rates dropped from highs of around 3.7 percent per year in the 1970s to 1.7 percent in 2000.

Internal migration has led to a substantial shift in population from rural to urban centers. In 1970 approximately 23 percent of Mexico’s population was living in cities of 100,000 or more people. By 1997 these large cities accounted for 44 percent of the population, indicating that large cities nearly doubled in size in two decades. Mexicans continue to migrate to the cities to seek employment opportunities, as well as better educational opportunities and access to health care.

Mexico’s second largest city, Guadalajara, with a population of 1,633,216 in 1995, is located about 465 km (about 290 mi) northwest of Mexico City. It was a colonial center of considerable religious and architectural importance and is now a major hub for commerce and industry. Guadalajara is second only to the capital in its importance as a cultural center. The city has produced numerous literary and cultural leaders.

Netzahuacóyotl (1,233,868), is located just east of the capital and is inhabited largely by skilled and unskilled blue-collar workers employed in nearby industrial operations in the state of Mexico and in the Federal District. Netzahuacóyotl suffers from serious problems, including inadequate housing, communications, and basic services.

Monterrey (1,088,143), located in the northern border state of Nuevo León, is the center of Mexico’s iron and steel industry and is for that reason often called "the Pittsburgh of Mexico." Many residents of the city pride themselves on their entrepreneurial spirit and resent the domination of the capital. Monterrey is second only to the capital in its concentration of important, capital-intensive industries. It is a major center of economic activity, and a significant channel of commerce linking Mexico to the United States.

One of the oldest Mexican cities, located southeast of Mexico City in the neighboring state of Puebla, is the colonial town of Puebla (1,222,569). The state capital, it is an important commercial link between Mexico City and the major Gulf Coast port of Veracruz to the east. Finally, one of Mexico’s newer cities and an example of the rapidly growing north is Ciudad Juárez (1,011,786), the largest border city with the United States, and a major source of trade and transportation with its sister city, El Paso, Texas.

Native Americans are concentrated in the regions of Mexico where indigenous civilizations were located at the time of the conquest. These regions are mainly in central, southern, and southeastern Mexico. For example, the state of Yucatán, where the Maya civilization was important, has the highest concentration of Mexicans who speak a Native American language (44 percent). The state of Oaxaca is second with 39 percent, followed by Yucatán’s neighboring states of Quintana Roo and Chiapas, with 32 percent and 26 percent respectively. The central states of Hidalgo and Puebla also have significant proportions of Native Americans.

Mexico’s 1917 constitution guarantees freedom of religion. Major constitutional reforms in 1992 eliminated many of the severe restrictions on the Catholic Church and other religions. Reforms included the repeal of measures that had prevented clergy from voting. Although still prohibited from direct involvement in political affairs, Catholic bishops have recently become more vocal in criticizing economic policies and human rights abuses.

About 90 percent of the Mexican population identifies itself as Catholic, but in recent years Protestant religions have become more important, particularly in rural regions and among Native Americans. Most of the growth in Protestant religions has occurred among evangelical sects. In 1997 Protestants accounted for approximately 5 percent of the population, and atheists 4 percent.

The states that are the least Catholic generally have the highest percentages of Protestants. In the state of Chiapas 16 percent of the population is Protestant and 13 percent claims no religious affiliation. Tabasco, which persecuted priests in the 1930s and implemented severe restrictions on the Catholic Church, has a Protestant population of approximately 15 percent. The states of Campeche and Quintana Roo have Protestant populations of 14 and 12 percent, respectively.

Although religious attendance declined significantly in the 20th century, religion is regaining its appeal among younger Mexicans. According to public opinion surveys in the late 1990s, many Mexican Catholics who do not regularly attend church still describe themselves as quite religious.

In the 1917 constitution, public education became mandatory through grade six. School attendance is high among 6 to 14 year olds, and 85 percent of all boys and girls are in class at that age. Attendance declines significantly after age 13, somewhat more so for girls. In the late 1990s, nearly 43 percent of the population 15 years old or older had received some secondary or college education. Nineteen percent had completed primary school, and the remainder did not complete the sixth grade.

Mexico has improved its literacy rate through public education programs, but rapid population growth has made it more difficult to reduce the absolute number of Mexicans who cannot read or write. In 1970, for example, 26 percent of all Mexicans age 15 or older were illiterate. By 1995 only 10 percent of that age group was illiterate. This was still a group of about six million people, or about as many people as were illiterate 20 years earlier. There are no significant differences in literacy rates based on gender. However, literacy rates are lowest in those states that have the highest poverty levels and, typically, high percentages of Native Americans. The lowest rates are in the states of Chiapas, Oaxaca, and Guerrero, which all had literacy rates less than half the national average in 1997. The most urbanized centers boast the highest literacy rates; the Federal District, for example, had a literacy rate of more than 95 percent in 1997.

Mexican higher education is also dominated by public institutions, many of them in the capital city. In 1992 public universities accounted for about 82 percent of all college graduates. Approximately 1.3 percent of Mexicans were attending college or graduate school in 1992 and about nine percent (over age 16) had graduated from college. Mexico’s leading institutions include the National Autonomous University of Mexico (founded in 1551), the National Polytechnic Institute (1937), the Colegio de México (1939), the Autonomous Technological Institute of Mexico (1946), and the Ibero-American University (1943), all located in Mexico City. Other important universities include: the University of Guadalajara (1792); the Benemérita Autonomous University of Puebla (1937); Veracruz University (1944), located in the city of Jalapa Enríquez; and the Institute of Technical and Advanced Studies of Monterrey (1943), which is known by its Spanish acronym ITESM. Both the Ibero-American University and ITESM have established numerous branch campuses throughout the republic.

The typical Mexican dresses similarly to people in Europe and the United States, as fashion in Mexico is influenced by international trends. Rural families dress in more traditional clothes, and the indigenous dress worn by many Native Americans often distinguishes them from mestizos who generally wear European-style fashions.

Mexican food is unique and diverse, but income level and social class differences often affect culinary customs. The basic diet of working-class Mexicans relies heavily on corn or wheat tortillas, along with beans, chili peppers, and tomatoes. Middle- and upper-income Mexicans consume a wide array of dishes, influenced by trends in the United States and Europe. Ready-made products such as cold cereal, either produced in Mexico or imported into the country, are often found in Mexican kitchens. Mexico has one of the most highly developed carbonated beverage industries in the world, and per capita consumption of soft drinks is high. Mexican-produced beer is extremely popular in Mexico and is also sold throughout the United States. In recent years Mexico has increased the quality of its wine production, and liquors such as brandy and tequila are manufactured on a large scale.

Compared to the United States, Mexico’s middle class is relatively small, making up a little more than one-third of the population. Many middle-class Mexicans have lifestyles similar to those of middle-class families in the United States—living in homes or apartments with modern amenities such as electricity and running water, owning one or more automobiles, and having access to educational and health-care facilities.

Most Mexicans, however, live in varying degrees of poverty. Although the Mexican government does not issue official poverty figures, several national and international organizations have issued studies that attempt to paint a picture of the extent of poverty in Mexico. Many of these organizations use a "Basic Basket of Foodstuffs" to determine whether families are able to satisfy their minimum needs for nutrition, housing, clothing, and health care. This basket of goods and services is given a monetary value and those households whose daily income is not enough to afford this basket are said to be living in "extreme poverty." Those households whose daily income is more than the value of the basic basket, but not greater than twice the value, are said to be living in "poverty." A 1996 study by Mexico’s National Autonomous University put the value of this basket at US$5.39 a day and said that 51 percent of Mexican families could not afford this basket and were therefore living in "extreme poverty." This was up from 32 percent in 1993 and 16 percent in 1989. A World Bank report, also from 1996, said that one-fourth of Mexicans earned less than US$2 a day and that 17 percent of Mexicans earned less than US$1 a day.

Mexico’s recent economic problems have hurt middle- and lower-income families much more than they have hurt wealthy families. During the late 1980s and early 1990s, Mexico’s highest income groups increased their overall wealth, while the earnings of poor Mexicans declined significantly. For lower- and middle-income families, this often meant that they had to reduce their already limited spending on food and other basic necessities.

Many poor Mexicans have little or no access to health care and live in housing that lacks one or more basic amenities such as electricity, running water, or sewerage. Although the quality of housing has improved considerably since 1970, in the mid-1990s approximately 12 percent of Mexican households remained without electricity, 11 percent lacked running water, and 26 percent were without sewer facilities. Many children also suffer from malnutrition and drop out of school early in order to begin earning money for their families.

In addition, Mexico’s rapid population growth has severely strained government services, especially education and health care. This growing population has placed tremendous pressure on the government and economy to create new jobs. The economy in the 1980s and 1990s has not been able to create enough jobs to keep up with population growth. Economic conditions have prompted thousands of skilled and unskilled workers to migrate north to the United States in search of employment.

Mexican cities suffer from many of the same social problems found in urban environments around the world. Poor economic conditions, however, have significantly increased the levels of urban crime in the country, especially in Mexico City. Drug abuse and juvenile crime have also increased in major cities in recent years.

It was during the revolutionary period, however, that important groups of intellectuals, poets, and novelists began to develop significant literary movements in Mexico. The "generation of 1915" was one of the most important; many of this group became distinguished figures in public life. Mariano Azuela, a physician who participated in the Mexican Revolution under General Francisco "Pancho" Villa, authored the most widely read novel of that violent period: Los de Abajo (1916; translated as The Underdogs in 1929). The book portrayed the revolution in discouraging terms and is widely considered to be the best Mexican novel of that era.

Mexico has produced numerous writers, essayists, and poets of international renown, including Octavio Paz, who in 1990 became the first Mexican to receive the Nobel Prize in literature. Carlos Fuentes is another Mexican writer whose fiction is widely read in Europe and the United States. He often writes about social issues in contemporary Mexico, but his best-known work deals with the decades that followed the Mexican Revolution. See also Latin American Literature.

Other artists pursued a different tack. Frida Kahlo painted numerous small self-portraits which captured her own vision in strange, often surrealistic presentations. Kahlo fractured her spine and pelvis in a traffic accident as a teenager and began to paint while recovering from her accident. The constant pain Kahlo suffered due to her injuries, as well as her sadness over being unable to bear a child, are reflected in much of her work.

In the 1930s Rufino Tamayo combined native folk themes with European art forms such as cubism. His work reached a much larger foreign audience than that of other Mexican artists, particularly in Europe and New York City. Tamayo was an outspoken opponent of the painting style of the revolutionary muralists, arguing that their focus on political and social themes came at the expense of artistic quality. The intense colors of many of Tamayo’s paintings and his use of flattened two-dimensional figures—a style that is common in Mexican folk or pre-Columbian art—gave his work a distinctly Mexican flavor.

Manuel Alvarez Bravo, who associated with some of the leading creative photographers in the United States, such as Edward Weston and Tina Modetti, became the first Mexican photographer to reach a large international audience. He was influential in promoting photography as an art form in Mexico. See also Latin American Painting; Latin American Sculpture.

In the late 19th and early 20th centuries, the French splendors of the Second Empire style were introduced in Mexico City. This trend began under Emperor Maximilian, who ruled Mexico briefly during the 1860s, and later under President Porfirio Díaz. Díaz commissioned the ornate Palace of Fine Arts, which was completed in the 1930s. Since the Mexican Revolution (1910-1920), many outstanding examples of modern architecture have been built in Mexico. The National Autonomous University of Mexico contains many spectacular modern buildings that feature murals in fresco and mosaic. It includes a multistory library almost completely covered by mosaics designed by Juan O’Gorman. Another Mexican architect, Félix Candela, created highly original concrete shell designs for several churches and for the sports palace at the 1968 Olympic Games. One of Mexico’s most internationally admired architects, Pedro Ramírez Vázquez, designed the renowned Museum of Anthropology and History in downtown Mexico City. See also Latin American Architecture.

Carlos Chávez, Mexico’s best-known composer, is remembered for his Sinfonia India (1935). A close friend of the painter Diego Rivera, Chávez wanted to employ Native American themes in his music, just as the Mexican muralists had done with their paintings. Chávez introduced 82 Mexican works as conductor of the National Symphony from 1928 to 1949. He studied piano under Manuel M. Ponce, another major figure in Mexican music, who founded the Academy of Music in Mexico City in 1911. Ponce served as a mentor to generations of Mexican musicians. Another figure in Mexican music, originally from Spain, was Rodolfo Halffter, who did much to encourage new students as a professor at the National Conservatory of Music.

Mexican popular music, in the form of ballads and sidewalk performances, has contributed significantly to popular music in the United States. Examples include "La Bamba," a Mexican folk song that was recorded in a rock-and-roll style by American singer Ritchie Valens in 1959, and the work of the Tijuana Brass in the 1960s and 1970s.

Since the 1940s refugees from the Spanish Civil War (1936-1939) have contributed significantly to the expansion and quality of motion pictures in Mexico. Among the exiles working in the country, Luis Buñuel was one of the best known. His film Los Olvidados (The Forgotten, 1950), a film about juvenile delinquents in Mexican slums, is considered a classic. Although most Mexican films have not received widespread distribution outside of Mexico, some more recent work has achieved considerable international attention. Like Water for Chocolate (1992)—a film directed and produced by Alfonso Arau and adapted from the novel of the same name written by Laura Esquivel—was a hit in the United States and became the most successful film in Mexican history.

Theater also has a long tradition extending back to the colonial period, including the work of Juana Inés de la Cruz. Many of Mexico’s important directors and playwrights have been supported by various groups at the National University in Mexico City (now National Autonomous University of Mexico).

Mexico City boasts several world-famous museums, noted not only for the quality of their collections but also for the architecture of the buildings themselves. The National Museum of Anthropology, designed by Pedro Ramírez Vázquez, exhibits a striking array of archaeological discoveries from Mexico’s pre-Columbian era. The Museum of Mexico City is an excellent source of historical and archaeological information on the capital itself. The National Museum of History, devoted to history since the Spanish conquest, is located nearby in Chapultepec Park. The Museum of Modern Art, also located in the park, contains the finest collection of Mexican painting from the 19th and 20th centuries, including the work of internationally known masters such as Diego Rivera, José Clemente Orozco, David Alfaro Siqueiros, and Rufino Tamayo. Shortly before his death, Tamayo donated his personal collection of European and Mexican works, as well as many of his own paintings, to the Museum of Modern Art.

The economic recession led the government to reexamine Mexico’s national economic policy, which had protected the nation’s young industries by imposing high tariffs on imported goods. These tariffs raised the price of goods imported from the United States, for example, and encouraged Mexicans to buy less expensive goods produced in Mexico. On the other hand, this policy reduced competition in the Mexican economy and induced many state-owned industries and private companies to become less efficient. The Mexican government began to replace this official protection of domestic industries with an aggressive policy of privatization, selling back government-operated and owned industries—including banks, utilities, airlines, and manufacturing companies—to the private sector. Privatization aimed to make Mexican companies and industries more efficient and competitive by allowing private owners, rather than government officials, to make decisions that would affect an industry’s profitability.

Mexico also began working to integrate its economy into the larger and much more competitive global economy. These efforts culminated in Mexico’s signing of the North American Free Trade Agreement (NAFTA), which went into effect in 1994. NAFTA is a trade pact between Canada, Mexico, and the United States that aims to foster free trade and eliminate tariffs among the three nations.

To support the peso and prevent a total economic collapse, the United States government, in conjunction with the World Bank, provided an emergency loan to Mexico in January 1995. However, the economic crisis was the worst in Mexico since the global economic depression of the 1930s, and resulted in negative economic growth in the country in 1995 and 1996. The economic crisis led to a serious decline in the standard of living for most Mexicans, as well as an increase in extreme poverty. The nation’s gross domestic product (GDP), the value of all goods and services produced domestically by a country, declined 6.2 percent from 1994 to 1995. Since then the economy has been recovering. In 1998 the GDP was $393.5 billion.

Official estimates of urban unemployment averaged between 6 and 7 percent in 1996, but most analysts believe that true rates of unemployment are much higher, and that underemployment in Mexico is significant. This situation has increased illegal immigration to the United States.

Throughout the 1980s and early 1990s, the structure of the Mexican workforce underwent major changes. Manufacturing and other industries—sectors of the economy that have traditionally provided stable jobs that pay good wages—saw little growth and created few new jobs. At the same time, the number of low-paying, service sector jobs increased. At the 1990 census, services employed 53 percent of all of Mexico’s labor force. Industry (including construction, manufacturing, mining, and power) employed 22 percent of the labor force. Agriculture (including forestry and fishing) employed about 24 percent.

Less than 20 percent of Mexico’s labor force belongs to a union, the majority of which are controlled by the government. Rather than being aggressive advocates for workers, Mexican unions have typically played a crucial role in supporting the government-dominated Institutional Revolutionary Party. In doing so, the unions have often agreed to government economic pacts to control inflation, prices, and wage increases. Mexican unions are noted for their levels of corruption and subordination to government influence. The major unions are the Mexican Federation of Labor and the National Farmers Confederation.

Agriculture accounts for only a small percentage of Mexico’s GDP. Although agriculture employed one-fourth of the nation’s economically active population, it only accounted for 5 percent of the value of the GDP in 1998. Between 1950 and 1990 this sector of the Mexican economy grew by only about 10 percent. This was due both to the declining importance of agriculture among the labor force and to Mexico’s increasing industrialization during this period.

Many of Mexico’s agricultural workers are subsistence farmers, who produce only enough to feed their families. Although the Mexican government distributed millions of hectares of land to poor farmers between the 1920s and the 1970s, the plots were generally small and the quality of the land was often poor. In addition, many small farmers were unable to obtain the credit they needed in order to purchase the seeds, fertilizer, or equipment they required to stay in business. This led to high rates of migration from rural areas into the cities, as well as northward to the United States.

Mexican agriculture is highly productive in certain regions, especially near the capital and in the northwest. Corn and beans, the staples of the nation’s diet, are the primary food crops, and they grow best in the valleys and basins of the central plateau that surround Mexico City. Wheat is raised on irrigated land in central and northern Mexico and has replaced corn in the diet of many Mexicans. Other principal agricultural products grown for domestic consumption include barley, rice, soybeans, vegetables, and citrus fruits.

Large volumes of products such as coffee, cotton, citrus fruits, sugar, and tomatoes are grown for export, primarily to the United States. Most coffee is grown in the southern states of Chiapas and Oaxaca, cotton is cultivated mainly on irrigated land in northwest Mexico, and sugar plantations are scattered in various states, with the largest concentration in Veracruz. About 20 percent of Mexico’s agricultural production is exported.

The main forage and hay crops are alfalfa and sorghum. They are raised in arid regions, often with the use of irrigation, and are important to livestock farmers. Beef cattle are the most important Mexican livestock and beef is an important export. Chickens are raised throughout the country and consumed locally.

Of the nation’s natural resources, petroleum far exceeds in value all other resources combined. In 1982 petroleum was Mexico’s number-one export product, accounting for 80 percent of the value of total exports. Until the 1930s many of Mexico’s natural resources were primarily controlled and operated by foreigners. After the Mexican Revolution (1910-1920), the nation began to nationalize many of its basic resources and industries. The nationalization of the petroleum industry in 1938, which had been owned primarily by U.S. firms, signaled the new lengths Mexico was willing to go to assert its sovereignty and regain control of its resources. Petroleum in Mexico is extracted, processed, and sold by Petróleos Mexicanos (Pemex), a government-owned company. Although most mining firms that the Mexican government once owned have been privatized, or sold to private investors, the petroleum industry remains largely in government hands. As of late 1996, some of Mexico’s petrochemical industries had been offered for sale, but only 49 percent of any operation can be purchased by foreigners.

Oil revenue is extremely important to the Mexican economy. In the mid-1990s oil accounted for about one-fourth of all government revenues and one-eighth of export earnings. In the 1970s reliance on petroleum earnings contributed to the country’s huge national debt. During this period, the government borrowed money at high interest rates and used the loans to finance the development of manufacturing and service industries. The government anticipated that it would be able to pay the loans off quickly with oil revenues. When the price of oil dropped steeply in the early 1980s, the Mexican government was unable to meet its loan payments and was forced to cut spending on economic development and social services.

In early 1998 a world oil surplus prompted Mexico to join forces with Saudi Arabia and Venezuela, other leading oil-producing countries, to restrict oil production. The surplus had caused a drop in oil prices, lessening Mexico’s earnings from petroleum. The reduced oil revenue led the government to cut $1.05 billion from the country’s budget.

Many large foreign companies, owned primarily by U.S. and Japanese investors, have located hundreds of maquiladoras in Mexico. These businesses produce specific parts of products to be sold in or exported from the home country, or they import parts from abroad, assemble the products in Mexico, and then ship the completed products back to the home country. This sector has been one of the fastest-growing in the Mexican economy, contributing significantly to economic growth, and providing new employment even during the years that followed the 1994 economic crisis.

Mexico’s most important manufacturing centers include the combined urban area of the Federal District and Mexico state, as well as the cities of Monterrey and Guadalajara. Since the late 1970s, Mexico has attempted to decentralize its manufacturing base and to encourage foreign investment in areas of central Mexico outside of Mexico City or the Federal District. While the nation has achieved some success in this area, most of Mexico’s poorer, rural regions have not attracted industry.

The nation’s major hydroelectric plants can be found in five mountainous states: Chiapas, Guerrero, Michoacán, Puebla, and Mexico. The Federal Electric Commission is responsible for the development of hydroelectric power. Natural gas, stored in small propane tanks, is widely used by Mexican households for cooking and heating water. Although the nation has major natural gas supplies, it has not developed the underlying infrastructure to supply its manufacturing industries or businesses.

Petróleos Mexicanos (Pemex) directs the extraction and production of petroleum-based energy. Mexico’s major petroleum processing plants are located in the cities of Minatitlán in Veracruz State, Ciudad Madero and Reynosa in Tamaulipas State, Salamanca in Guanajuato State, and Atzcapotzalco in the Federal District. Most of Mexico’s oil fields are located in the Gulf of Mexico or along the Gulf Coast. In the mid-1990s the states of Campeche, Tabasco, and Veracruz accounted for about 67 percent, 26 percent, and 4 percent, respectively, of the total volume of petroleum extracted in Mexico. Until 1994 gasoline for use in automobiles was sold only in government-franchised retail stations; after 1994 privately owned retail stations were permitted to operate in the country.

As a consequence of Mexico’s major economic crisis in 1994, and the subsequent decrease in the relative cost of goods produced in Mexico, the country’s export sector played an essential role in its economic recovery. The depressed economy produced a favorable balance of trade with Mexico’s largest trading partner—the United States. This meant that the value of goods exported from Mexico to the United States exceeded the value of goods exported from the United States to Mexico. In 1994, the first year that NAFTA was in effect, trade between the United States and Mexico totaled more than $100 billion, reflecting an increase of 23 percent over the previous year. Mexico’s prolonged economic crisis resulted in a drop in trade between the two countries in 1995. Nonetheless, the value of U.S. exports to Mexico in 1995 was still 11 percent higher than it was in 1993, the last pre-NAFTA year.

The economic effects of NAFTA have been hotly debated in Canada, Mexico, and the United States. The Mexican government and NAFTA supporters in the United States claim that the growth of export industries slowed Mexico’s economic slide in 1996, and that exports actually helped to launch an economic recovery by the end of that year. The output of Mexico’s border assembly factories, or maquiladoras, from January to August 1996 was 17 percent higher than the output for the same period in 1995. Similarly, multinational auto manufacturers operating in Mexico saw a sharp increase in export activity—the production of passenger cars for export rose by 23 percent in 1995 and the production of trucks for export leapt 132 percent during the year.

Critics of the trade pact claim that NAFTA has primarily benefited multinational companies operating in Mexico, while doing little to benefit the vast majority of Mexico’s citizens. While Mexico’s overall economic indicators showed an increase in foreign trade after the institution of NAFTA, real wages continued to fall throughout the country and poverty rates remained constant. Living conditions for many Mexicans worsened after NAFTA was put into place. NAFTA opponents say this is possible because export-oriented companies can take advantage of cheap Mexican labor without relying on the purchasing power of Mexican families. Since the products are being sold abroad, the success of the export industries does not hinge on Mexican citizens being paid enough to be able to buy their products.

Mexico’s chief trading partners, in terms of the value of Mexico’s exported goods, are the United States, Canada, Japan, Spain, Chile, and Brazil. Most of the goods imported into Mexico come from the United States, Japan, Germany, Canada, South Korea, Italy, and France. Mexico is also the third largest trading partner of the United States (behind only Canada and Japan), even though the Mexican economy is much smaller than that of either of those two countries.

In addition to NAFTA, Mexico is a member of a number of other trade organizations or agreements. Mexico belongs to the Latin American Economic System (known in Spanish as the Sistema Económico Latinoamericano, or SELA), an organization founded in 1975 to promote cooperation between the 27 member countries in Latin America and to accelerate economic and social development within these countries. In 1980 Mexico became a party to the General Agreement on Tariffs and Trade (GATT), a treaty and trade organization that worked to reduce tariffs, quotas, and other trade barriers between nations. Mexico is also a member of the Latin American Integration Association (known in Spanish as the Asociación Latinoamericana de Integración, or ALADI), an organization founded in 1981 to foster balanced economic development in Latin America. In 1993 Mexico became the first Latin American member of the Asia-Pacific Economic Cooperation (APEC) forum, an organization dedicated to promoting global free trade. In 1994 Mexico joined the Organization for Economic Cooperation and Development (OECD), which seeks to promote economic growth through global cooperation and trade. The next year, Mexico became a founding member of the World Trade Organization (WTO). The WTO replaced GATT and aims to promote and enforce global trade laws and regulations.

The Mexican government has instituted a number of peso devaluations since the 1970s. These devaluations reduce the rate at which the peso is exchanged for foreign currency. A peso devaluation is usually prompted by an economic situation in which the cost of goods and services in Mexico, measured in U.S. dollars, exceeds their actual value, thereby discouraging foreign tourism and the purchase of Mexican goods on the global market. Peso devaluations generally produce an increase in exports from Mexico, while bringing about higher prices for Mexican citizens. The peso was officially devalued by the Mexican government in December 1994, prompting a 45 percent drop in the value of the peso against major world currencies. The steep drop in the value of the peso induced many domestic and foreign investors to withdraw their money from the country, which brought on a severe economic crisis in early 1995.

Mexico’s federal reserve bank is the Bank of Mexico, a government-owned central bank that was created in 1925. The Bank of Mexico is the nation’s bank of issue, meaning that it controls Mexico’s total money supply by monitoring the banking system’s reserve requirements and by allocating credit to other banks. Although all domestic banks were nationalized in 1982, the administration of Carlos Salinas de Gortari (1988-1994) sold them back to private investors. The bank nationalizations had given the Mexican government more control over the nation’s economy, angering many businesspeople in the private sector. The privatizations helped to alleviate the distrust of the Mexican government that had developed among many Mexican investors in the early 1980s. They also allowed the government to direct the revenue made from selling the banks toward a number of social spending projects.

Mexico does not allow foreign-owned banks to operate retail outlets in Mexico. However, as a result of NAFTA, Mexico will open its banking system to foreign competition and begin allowing retail branches of foreign banks to operate in the country. It is likely that some Mexican banks will not be able to withstand foreign competition and will go out of business. Mexico’s banks have been criticized for inefficiency. Many major banks have exceedingly high levels of debt because their clients cannot repay their loans. Mexico has a stock exchange (Bolsa de Valores), located in Mexico City, and some of the stock of companies on this exchange is also traded on the New York Stock Exchange.

The growth of Mexico’s trucking industry has put pressure on the government to improve the highway system. Most of Mexico’s major highways are still only two lanes wide. Under President Carlos Salinas (1988-1994), the government encouraged private contractors and investors to build toll roads. Although a number of these were constructed throughout Mexico, their costs were so high compared to the public system, especially during the economic crisis that began in 1994, that most are not economically viable.

Mexico has a well-developed airline system that serves domestic and international destinations through links to every major U.S. and European carrier. The country’s major airports are located in Mexico City, Guadalajara, Monterrey, Puerto Vallarta, Cancún, Acapulco, and Tijuana.

Mexico’s long-standing urban transportation problems, especially in the Federal District, are gridlock and air pollution. Although there is a modern, efficient bus and subway system in the capital, cars remain the most popular form of transportation. The government has been forced to institute severe restrictions on automobile use in an attempt to reduce air pollution.

Mexico City has a large number of newspapers, which creates extreme competition among papers and results in a relatively small readership for each publication. Many of these papers are read nationally. Among the most influential are La Reforma, Excélsior, El Financiero, and La Jornada. Several magazines, noted for their independence and criticism of the government, are also published in Mexico City. These include Proceso, a left-of-center weekly, and two intellectual magazines, Vuelta and Nexos. The government has tried, on occasion, to censor the print media, primarily by threatening to withhold government advertising, which accounted for 20 to 30 percent of the revenue of Mexican newspapers in the 1980s. Television and radio are regulated by the government, which authorizes the production of programs on state-owned radio and television networks, as well as on a number of commercial broadcast networks. Talk radio, however, is increasingly independent. Many Mexicans use computers and e-mail, but the growth of the Internet is currently limited by the country’s relatively undeveloped system of telephone lines. Communication links from many parts of Mexico still must first pass through the capital, which slows both computer and telephone connections between regions of the country.

Recent guerrilla movements, most notably the emergence in 1994 of the Zapatista Army of National Liberation, or Zapatistas, in the state of Chiapas, severely damaged the tourist trade in southern Mexico. The appearance of another guerrilla group known as the Popular Revolutionary Army, which attacked government facilities near the tourist site of Huatulco in the state of Oaxaca in the summer of 1996, did not appear to affect the tourist trade in that region or elsewhere in Mexico.

Given the dominance of the executive over the legislative and judicial branches, interest groups and lobbyists similar to those found in the United States have not developed in Mexico. Groups and individuals who wish to influence policy do so primarily through the executive branch, seeking contacts with agency heads and cabinet figures and, on occasion, with the president himself.

The Chamber of Deputies has the power to pass laws, impose taxes, and verify elections. The chamber has at times disregarded election vote totals and simply declared certain candidates as winners. The Senate also ratifies treaties and approves certain presidential appointments. It may also authorize the intervention of the federal government in a state by declaring that constitutional order no longer prevails. In practice, both legislative bodies have little power or prestige, and all bills submitted to the president are approved. This is due both to the historical prominence of the president, and to the fact that legislators have little staff support to help them push their own agenda or counteract executive influence.

PAN was founded in 1939 by dissident leaders from the PRI. It occupies the center right of the political spectrum in Mexico, favoring rapid political reform and integrity in government. The party also calls for privatizing state-owned industries and resources and decreasing government spending on social services such as health care.

The Party of the Democratic Revolution was founded by dissident PRI and left-of-center party leaders in 1989. It dominates the center left. The PRD also favors rapid political reform, but cooperates less with the PRI than does PAN. Members of the PRD are often critical of some of the consequences associated with economic policies or trade pacts like the North American Free Trade Agreement (NAFTA). Some of these consequences include increased foreign control of Mexico’s economy after state-owned industries and resources are sold to foreign investors, and the failure of many Mexican businesses since NAFTA was first enacted in 1994.

In the 1980s, the PRI lost much of its popularity due to economic policies that had led to a steep decline in the standard of living of ordinary Mexicans. In 1987 a number of dissident PRI members were expelled from the party. Their leader, Cuauhtémoc Cárdenas Solórzano, ran for president in the 1988 elections at the head of a coalition of leftist parties. Cárdenas and many international election observers claimed that he won, but the election was marked by widespread fraud on behalf of the PRI candidate, Carlos Salinas de Gotari. Salinas was finally declared the winner, but opposition parties gained 240 seats in the Chamber of Deputies, ending the PRI’s 60-year reign of unchallengeable one-party rule. Due to the strong showing by Cárdenas, as well as subsequent electoral reforms, the size and strength of opposition political parties has grown considerably in recent years.

The average life expectancy for men and women in Mexico is 69 and 76 years, respectively. This is significantly lower than the average life expectancy in the United States (73 years for men and 80 years for women). The infant mortality rate in Mexico in 2000 was 23 per 1,000 live births. This compares to 7 per 1,000 in the United States. Intestinal diseases are endemic in many parts of Mexico and are the most common cause of death among children.

Mesoamerican civilization began to emerge around 2500 BC, as agriculture increasingly provided a reliable food source that could support larger and larger populations. Freed from having to constantly search for food, the formerly nomadic peoples were able to establish permanent settlements. The shift from a hunting-gathering existence to one that revolved around agriculture and village life also gave people more time to devote to architectural and cultural pursuits. This made possible large public projects such as irrigation canals and temples, as well as the creation of fired clay objects such as dishes and containers.

The city-state of Teotihuacán, located in the Valley of Mexico about 40 km (25 mi) northeast of modern-day Mexico City, in turn became a powerful cultural center. Teotihuacán flourished as an important commercial and religious center between about AD 100 to 650. It had a population of about 125,000 at its height, making it one of the largest cities in the world. Teotihuacán’s wealth and productivity enabled its inhabitants to construct great monumental structures, including the Pyramid of the Sun, more than 60 m (more than 200 feet) high, and the slightly smaller Pyramid of the Moon. Teotihuacán’s influence declined around AD 650, and the city was destroyed by a natural disaster or invasion. The fall of the "city of the gods" dispersed its people and culture across Mesoamerica.

The Zapotec people began building their religious center and capital at Monte Albán around 500 BC. Located on a mountaintop in what is now the state of Oaxaca, Monte Albán was one of the first cities in the Americas and rivaled Teotihuacán as a center of Mesoamerican culture. At its height, about AD 500, the city was home to approximately 25,000 people. The Zapotecs developed one of the earliest writing systems in the Americas, using pictorial characters known as hieroglyphics to convey simple ideas. They left numerous hieroglyphic inscriptions on the buildings and temples of Monte Albán.

About AD 900, the Maya centers were mysteriously abandoned, and some Maya migrated to the Yucatán Peninsula. During the Postclassic period, from 900 to the arrival of the Spanish in the 16th century, Maya civilization was centered in the Yucatán. A migration or invasion from central Mexico strongly influenced Maya culture and art styles during this period. Chichén Itzá and Mayapán were prominent cities.

The Toltecs rose to power in the 10th century AD and are the first people in Mesoamerica to leave a relatively complete history. Their capital of Tula, whose ruins are located near the town of Tula de Allende 75 km (47 mi) north of Mexico City, extended its political influence over much of central Mexico. Other groups paid them tribute. The Nahuatl-speaking Toltecs established colonies along their northern frontier, protecting the region against hostile groups and greatly expanding the amount of land given over to agriculture. In the 12th century droughts in the north central region weakened the Toltec hold on the region. Desperate and starving people from the north surged southward, eventually overwhelming the Toltecs and forcing them to abandon Tula. Toltec survivors migrated south to the Valley of Mexico, where they joined with other peoples.

Not all Native American groups reached the complex levels of culture achieved by those of southern and central Mexico. In general, as one moved northward the indigenous peoples tended to be more tribal and nomadic, with exceptions such as the Pueblo in what is now the southwestern United States. Native Americans in northern Mesoamerica, typically warlike and nomadic, could not be easily conquered and resisted intruders until well into the 19th century in some areas.

Tenochtitlán’s military strength increased, and under Itzcoatl, the first Aztec emperor, the Aztecs extended their influence throughout the entire Valley of Mexico. By the 15th century, the Aztecs had become the preeminent power in central and southern Mexico.

The political organization of the Aztec Empire extended far beyond Tenochtitlán and rested on a triple alliance between the city-states of Tenochtitlán, Texcoco, and Tlacopan. The alliance, which was established in the mid-1400s, was soon dominated by the Aztecs. A series of military campaigns extended the Aztecs’ power and influence well beyond the central valley and across Mesoamerica. On the eve of the Spanish conquest, Aztec-controlled territory reached west to the Pacific Ocean, east to the Gulf of Mexico, and south nearly to the modern-day border with Guatemala. Because of resentment against Aztec rule and internal strife within the far-flung Aztec Empire, Spanish invaders would later be able to ally with a number of Native American peoples who would help them to defeat the Aztecs.

Aztec priests typically offered the gods human hearts and blood from just-killed victims—most often male prisoners who had been captured in battle and later marched or dragged to the top of a ceremonial pyramid. The need for new sacrificial victims was one factor that pushed the warlike Aztec to continuously seek new territory and peoples to conquer.

Aztec religion also included worship of the plumed serpent Quetzalcoatl, the god of wind and learning. According to Aztec legend, Quetzalcoatl had been tricked and disgraced by another god, Tezcatlipoca, and then traveled to the east. He vowed to return and destroy those who worshipped his enemies. By the early 1500s, word of the arrival of the Spaniards in the Caribbean Sea had traveled to the Aztecs, triggering rumors that an angry Quetzalcoatl had returned to exact his revenge. While the Aztecs would soon learn that the Spanish conquerors were not gods, the prophecies of great destruction coming from the east would prove to be a reality.

The first governor of Cuba, Diego Velázquez, sponsored three expeditions in the early 1500s that sought to explore the Gulf Coast of Mexico. The first expedition, commanded by Spanish navigator and conqueror Francisco Hernández de Córdoba, set sail from Cuba in 1517 and explored uncharted territory along the Yucatán Peninsula. When Spanish soldiers went ashore to seek water and food they were often attacked by Maya warriors. The Spaniards and the Maya engaged in a major battle in Champóton, now a port in the modern state of Campeche. More than half the Spanish expedition was killed. While the expedition ended in failure, it provided the Spaniards with more detailed knowledge of the native inhabitants of the region and sparked new interest in Mexico.

In 1518 Governor Velázquez sponsored another expedition, this time under the command of his nephew, Juan de Grijalva. The Spaniards returned to Champóton, where they avenged the defeat of the previous expedition, forcing the Maya to retreat inland after three days of fierce fighting. The expedition continued exploring the Gulf Coast, eventually encountering friendly Mayan-speaking peoples who told the Spaniards of a powerful empire to the west. Although the Spaniards did not realize it, they had reached the outer limits of the Aztec Empire.

The ruler of the Aztec Empire at this time, Montezuma II, had received reports of the Spanish explorations, as well as the battles at Champóton. He ordered his subjects along the Gulf Coast to greet the foreigners, offer them a large feast and gifts of gold and jewelry, and then ask them to leave the region. Montezuma knew of the Aztec legends and omens predicting future destruction, and is reported to have wondered whether the arrival of the Europeans heralded the return of an angry Quetzalcoatl.

As Cortés loaded his ships and recruited additional men in Cuba, some of his enemies complained that he was a poor choice to lead the expedition. They convinced Velázquez to cancel Cortés’s commission to lead the force. Cortés ignored the orders and set sail in February 1519 with about 600 men, as well as a few cannons and horses. On the Yucatán Peninsula, the expedition rescued a shipwrecked survivor, Jerónimo de Agúilar, who had been held captive by the Maya for eight years. He would provide the Spaniards with a valuable translator of the Mayan language.

The expedition sailed west along the Yucatán Peninsula and the Gulf Coast, engaging in a major battle against Tabascan warriors at the mouth of the Grijalva River. Cortés quickly realized the value of horses in battling the Native American peoples—the Tabascans had never seen horses and many fled in fear. The expedition sailed north in search of a good harbor and established a town, La Villa Rica de la Vera Cruz, at what is now the city of Veracruz. Cortés organized an independent government, renounced the authority of Governor Velázquez, and acknowledged only the supreme authority of the Spanish monarchy. In order to prevent any of his men from deserting because of these actions, Cortés destroyed his fleet.

When Cortés started to march inland he had about 500 men remaining. The Spaniards soon encountered the Tlaxcalan people, who lived east of the Aztec Empire and resented Aztec domination. Despite this resentment, the Tlaxcalans initially battled the Spanish invaders. After two weeks of fighting and heavy native losses, the Tlaxcalans surrendered and became allies of the Spaniards against the Aztecs. Until the conquest was achieved in 1521, the Tlaxcalans were important allies of the Spaniards and helped create a combined European/Native American army that numbered in the thousands.

In October 1519 the Spaniards and several