Ciudad Juarez-El Paso, The Formation of A Cross-border Market Mexico-U.S. Economic Relations in Perspective, 1840s-1920s Belinda Roman UMI Number: U613345 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. Dissertation Publishing UMI U613345 Published by ProQuest LLC 2014. Copyright in the Dissertation held by the Author. Microform Edition © ProQuest LLC. All rights reserved. This work is protected against unauthorized copying under Title 17, United States Code. ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106-1346 8203 IOIS&S To Aztlan Abstract This thesis will demonstrate that C. Juarez, Chihuahua-El Paso, Texas have operated as a cross- border market since the nineteenth century. As a consequence of this, it may be inferred that economic integration between Mexico and the United States of America (U.S.) is a historical process that also begins in the nineteenth century. This positions challenges the conventional academic wisdom that integration, in this case, is primarily a post-World War II phenomenon. The study uses economic integration theory as a new way of conceptualising the Mexico-U.S. borderlands. The fundamental premise is that factor mobility and the formation of a distinct, unified regional market underpin the integration process. A case study of the C. Juarez-El Paso, Texas border area between the 1820s and the 1920s is used to examine the complex nature of the interchanges between the two countries. The analysis is divided into eight chapters, with the major analytical chapters focussing on the ability of the factors of production (entrepreneurs, capital and labour) and goods to move freely throughout the region. The two key assumptions are that the C. Juarez- El Paso area possesses a common transportation infrastructure and resource base. The study of entrepreneurs is based on qualitative material taken from travel diaries, government documents and business records. The work of Chandler and Casson is utilised to show the similarities in activities and organisational structure across the border. The formation of a cross- border labour market is applied to low wage, low skill workers and evidence for regional wage rates is gleaned primarily from the work of Clark and Gamio on Mexican labour in the U.S. Southwest. The financial aspects of entrepreneurial activities are used as a proxy for capital movements. The sources include notarial and business records. Finally, the intensification of trade between Mexico and the U.S. due to specialisation at the border is examined. Data is taken from numerous sources, including contemporary accounts and U.S. government documents. Acknowledgments It is incumbent upon me to all of the individuals, institutions and organisations that have lent their support to my work over the years. Firstly, I would like to thank Dr. Oscar Martinez, whose input at the beginning of my journey encouraged me to pursue the concept of the dissertation. Dr. Martinez’ work over 20 years earlier served as an inspiration for my own. I would also like to thank Dr. Edward Beatty, who provided very insightful comments on early drafts that have helped me to better frame the arguments, and Ricardo Leon for his guidance and work on local financial networks in the Chihuahua area. I must recognise my London friends Candice Middlehurst, Dr. Alejandra Irigoin and Gwen Williams, who encouraged me to continue, and my parents Jose and Olivia Roman, whose belief in learning has always served as an inspiration. I would like to extend a special thanks to Anna McGullivary, Dr. Sam Brunk, Dr. Regina Grafe, and Dr. John Walker, all of whom served as outside readers in the later stages of this effort, and to Dr. John Hart, whose input gave me last minute inspiration. To Alfredo Arroyo, I thank him for the words of encouragement, support and understanding. Secondly, I would like to acknowledge the support of the Southwestern Social Sciences Association, Economic History Society (U.K.) and the Economic History Association (U.S.), and the Business History Conference (U.S.) all of whom invited me to present my ideas as a new researcher, thereby affording me an opportunity to test my work and obtain constructive input. The efforts of the special collections and archives in the C. Juarez-El Paso area that I consulted in my search for primary material must also be recognised. Three are of particular importance, the Special Collection at the University of Texas - El Paso, The Southwest Room and the El Paso Public Library, and the Centro de Investigaciones del Estado de Chihuahua (CIDECH). These collections have gathered material from numerous local, regional and national sources in an attempt to build a cross-border history. The dedication and assistance of regional librarians and historians in building centralised resources was invaluable. The resources held by the Nettie Lee Bentsen Collection at the University of Texas - Austin, and the Federal Records Centers in Fort Worth Texas and Washington, D.C. also proved useful. I also extend my gratitude to the El Paso Electric Company and the Greater El Paso Chamber of Commerce for allowing me access to internal reports on their respective operations. Finally, to my supervisor Colin Lewis, I extend a warm thanks. His gentle nudging through the course of my work has taught me how to express my views as a scholar. Table of Contents Page 6 7 P arti Introduction and Literature Survey 10 Economic Theory and Thesis Methodology 42 Historical Contexts 81 Part II The Cross-border Resource Base and Transportation 121 Infrastructure Cross-border Entrepreneurs and Enterprises 148 The Cross-border Labour Market 182 Cross-border Financial Networks and Trade 216 The C. Juarez-El Paso Cross Border Market 252 265 268 List o f Tables Page Population for C. Juarez, Chihuahua and Mexico, 1802-1990 14 Population of El Paso Texas and the U.S. 1850-1990 15 Population in and around C. Juarez and El Paso -1802-1920 125 Comparison of the Percentage Change in population Growth for El 192 Paso, Texas and C. Juarez, Chihuahua with State and Country, 1850-1920 Comparison of Populations and percentage change, 1880-1920 193 Comparison of origin of residents in Chihuahua and Texas, 1880- 193 1920 Comparison of Migrants entering on Seasonal Work Permits and 201 Legal Immigration from Mexico to the US, 1870-1920 Occupational Structure of El Paso in 1910 and 1920 204 Daily Wage rates paid to Railway, Mining and Agricultural 210 labourers between 1900-1914 Exchange through C. Juarez-El Paso, 1822-1869 232 U.S. Imports of Mexican Silver through C. Juarez- El Paso, 1884 - 237 1889 C. Juarez-El Paso Exchange, 1893-1920 238 Comparison of Cattle, Lead Ore, Machinery and Agricultural 239 Implements through C. Juarez-EL Paso to U.S. Export and Imports, 1893-1920 Comparison of Canada, Mexico, U.S. GDP in 1990 International 250 U.S. dollars(I$) List of Figures Page Figure 1.1 Map of the Mexico-U.S. Borderlands 9 Figure 4.1 Principle Centres and Mineral Deposits in the Cross-border Region, 120 1910 Figure 4.2 Progression of transportation network, 1848 to 1910 135 Figure 5.1 Mode of Transport, 1890 158 Figure 5.2 Mode of Transport, c 1910 158 Figure 5.3 The El Paso Electric Company Electric Grid, 1923. 171 Figure 6.1 Mexican National Crossing the Rio Grande 196 Figure 7.1 Schematic Model of C. Juarez-El Paso Cross-Border Financial 225 market Figure 7.2 Log of Trade between Mexico and the U.S. compared with 248 Border Trade and C. Juarez-El Paso Trade Parti Figure 1.1 Mexico-U.S. Borderlands1 CALIFORNIA ARIZONA NEW M EXICO Bakersfield A m arillo Albuquerque Los Angeles Pacific Ocean L u b b o ck Fort W orth D a lla s Calexico S a n D i e g o * _____________ P h o e n ix TijuanaWI Tecale • ZjVuma —- ' Vi M exicalif San Luis Colorado J u c s o n E n se n a d a ( • \ 5 L :l P a s o Ciudad* TEXAS Agua Priela luarez Austin H o u s to n • SONORA San Antonio H erm osillo / Ciudad f I Acuna A / .Chihuahua Piedras NegrasV t Ea9le Pass c orpUS V / Christi • (C u a y m a s C ulf o f Mexico C iu d a d ' O b re g o r CH IH UAH UA Nuevo Laredo* COAHUILA McAllen m Brownsville lo n terr ey rM a ta m o ro s Saltillo' Reynosa Torreon NUEVO •Ciudad Victoria LEON j V TAMAULIPAS too 2 00 Miles iTam pico This map was adapted from a map found in L. Herzog,Where North Meets South: Cities, Space and Politics on the U.S.-Mexico Border (Austin, 1990) introduction. CHAPTER ONE INTRODUCTION AND LITERA TURE SUR VEY In 1993 the Economic Development Division of the Greater El Paso Chamber of Commerce commissioned DRI/McGraw Hill to conduct an extensive economic strategic analysis of the El Paso, Texas, area in an attempt to produce a ‘straight forward’ and factual analysis of the city’s economy.1 Completed in 1994, the report revealed that, economically speaking, El Paso was co-dependent on Ciudad Juarez, Chihuahua2 in a way that could be considered unique. Furthermore, the document asserted that, ‘the seamless, smoothly functioning cross-border metropolitan economy,’ had enormous potential.3 However, individually, the two cities would be isolated within their respective national economies, and their continued development would be limited.