An Analysis of the Market Structure of the Tourist Parking Lots in Nogales, Arizona
This paper focuses on the market for daily parking in a one mile radius of the Nogales,
Arizona/Nogales, Mexico border.
Traveling to a foreign country often requires numerous preparations, and months of
planning; paying and waiting for a passport, booking a hotel, and airfare. Yet for the average
United States citizen, the proximity to Mexico provides a convenient and cost-effective
opportunity for international travel by car. According to the World Tourism Organization, some
11.7 million tourists traveled by road to visit Mexico in 2004. While this number cannot be
attributed to United States citizens in its entirety, approximately 94% of total tourism in Mexico
is comprised of United States citizens (World Tourism Organization). Out of this number,
approximately 72,139 tourists were considered “day visitors”. It is this high popularity of
traveling to Mexico by car coupled with United States’ policy (to be discussed in detail) that has
led to the construction of the border parking lots.
During the 1970s the Nixon administration began an anti-drug campaign that
came to be known as the "war on drug abuse" era. The crackdown of the importation of illegal
substances into the United States gave birth to the creation of the Drug Enforcement
Administration (DEA). The DEA enabled more efficient searches to take place especially along
the border of Mexico and the United States. It was during this time that the Canine Enforcement
Training Center was established in Washington D.C. (U.S. Customs Today) and the use of the
canine came into play as officers came to rely on skilled dogs and their handlers to detect various
drugs. Although the DEA and the use of canines were successful in limiting the number of illegal
substances brought into the United States, they also led to longer lines along border crossing
stations. Many tourists grumbled at the long lines and prolonged hours they were forced to
endure in their cars while waiting to cross the border. As a result of the cumbersome lines,
American tourists began parking their cars on the American side of the border and then walking
across to Mexico by foot. This, essentially, opened up a new market for parking lots.
The local entrepreneurs, realizing there were profits to be made, began opening up
parking lots just outside of the border crossing stations. The process involved buying a parcel of
land1, paving it over with asphalt and enclosing the area with some type of fence. These owners
then hire locals to work the lots at average wages of $5.15, $5.20 and $6.00. The differences in
wages can be attributed to length of employment and experience2. On average there are one or
two attendants working for one lot in shifts (typically three or four) over a twenty four hour
In order to obtain data regarding the specific numeric variables involved in...