Mayte writes*
Mexico City is renowned for its vibrant street food. Nothing beats tacos with pico de gallo and salsa after a night out. But recently, I’ve noticed that some of my favorite taquerias have turned down the heat in their salsas. After some chats with friends and a quick Google search, I realized that I am not alone in this feeling and that the culprit seems to be gentrification.
Since the COVID-19 pandemic, Mexico City has become a popular spot for digital nomads, according to their rankings. Specifically, the neighborhoods of Condesa and Roma in the historic center of the City have become increasingly popular (Brooks,2022). Given that the salaries of these nomads are in USD, they have larger purchasing power compared to locals, ultimately increasing rent prices and living costs in these neighborhoods. For traditional taquerías and street stalls, this has resulted in increasing competition with artisanal coffee shops, upscale brunch spots, and international fusion restaurants. This influx of wealthier consumers brings a change in preferences, leading to a shift in the market equilibrium—where milder salsa flavors become more profitable, as shown in the figure below.
Local vendors are faced with an economic trade-off: they can either cater to a broader less spice-tolerant customer base and lose traditional recipes or risk losing business in an increasingly competitive market. Many choose to meet this new demand curve, reducing the spiciness of their salsa to adapt to the preferences of these new customers. For local consumers, less spicy means less utility when it comes to late night recoveries and fewer pesos in your pocket.
Gentrification has also increased the opportunity cost of maintaining traditional salsa recipes. Adjusting spice levels can be seen as a rational response to market incentives, appealing to the preferences of higher-income consumers, who have greater purchasing power and influence on market trends. However, in reality, not all vendors have adopted this market strategy. Some taquerias have chosen to present their salsas with tiered spice levels allowing consumers to self-select according to their tolerance to spice allowing vendors to maximize their profits without alienating local customers (Wagner, 2024).
As gentrification continues to reshape Mexico City, street vendors are challenged to navigate shifting demand, rising costs, and fiercer competition, even as they try to hold on to tradition.
While this post mostly focused on the culinary consequences of gentrification, I want to note that these shifts are just one reflection of a larger, more troubling problem. The economic pressures tied to gentrification have led to the displacement of long-time residents due to skyrocketing rental prices, pushing locals out of neighborhoods they’ve built over generations (Brooks, 2022; Narcia, 2024).
Bottom Line: Gentrification in Mexico City has altered the flavor of traditional salsas and the livelihoods of the communities that serve them. This raises important questions s on how to grapple with economic growth and its impacts on culture and local communities.
* Please help my Applied Economics students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice 🙂
Hi Mayte, thank you for shedding light onto this troubling matter. Hansika has posted something similar about tourism in Aruba.
I’ve been thinking about tourism a lot recently. Growing up in a typical Dutch suburb, traveling became a goal and a social standard that we strived to achieve at least once a year. Of course, tourists travel for different reasons, such as the genuine joy of experiencing different climates, natural environments, and cultures. But even for those who started with these motives, it seems the more superficial aspects of tourism now tend to overshadow their consumption patterns upon arrival. Today, people turn to Instagram to find the trendiest hotels and restaurants, while just a few years ago, there was more of an art to discovery.
However, even that incentive doesn’t excuse the external costs that both traditional and modern tourism bring. Just because we want to explore, it doesn’t mean we all should, or at least not in the way we currently operate. I think it’s time we rethink our tourism incentives by exploring sustainable alternatives. This could mean opting for travel by train or car instead of flying whenever possible, and prioritizing local spending over larger corporations.
Even then, though, we still face the underlying issue you mentioned. So, what’s the solution here? Gentrification, as you pointed out in the case of Mexico City, shows us the far-reaching effects of these economic pressures. In a similar way, tourism impacts the very fabric of the places we visit, driving up costs, changing the local culture, and making it harder for residents to maintain their way of life.
Thank you for your comment Sarah! I really agree with everything you said, when we travel to new places we must be aware of our positionality as tourists and the ways in which we interact with the communities we visit. As is common in economics, there is an inevitable tradeoff between new income sources from tourism and the economic pressures it generates for locals themselves.
As an important note, in the case of Mexico City this problem has mostly stemmed from people opting to permanently live in these neighbourhoods leading to a housing crisis in the area, rather than tourists visiting for a shorter amount of time.
Really interesting post! I hadn’t thought about how gentrification could influence gastronomy.
In Roma, Condesa, and Polanco, there are ten times more temporary housing units than permanent ones (MásporMás, 2024). I was one of those internationals near Condesa—though I did like my tacos spicy. I tried supporting local businesses by buying at markets and street food, but I was still contributing to rising prices for locals. Ultimately, there seems to be no truly ethical choice as a foreigner with a higher purchasing power under gentrification except not to move there at all. It’s hard to blame individuals for a mass phenomenon, and state regulation is key, but it shouldn’t be an excuse to overlook the consequences of the aggregation of our choices.
It’s also worth considering the economic stratification within Mexico City. A taco in a low-income area might cost less than 50 cents, around 1 euro in Roma or Condesa, and nearly 2 euros in wealthy neighborhoods like Santa Fe. While digital nomads bring in a higher purchasing power, there is also a significant difference in financial means within Mexico. Nevertheless, gentrification is a clear disruption to market dynamics while inequality could be considered the status quo.
Additionally, it’s interesting to look at gentrification in coastal tourist areas like Cancun, Playa del Carmen, or Bacalar—though the term might not fully capture the complexity of these changes. In Bacalar, for instance, a town of 41.754 residents (49,3% living in poverty) hosted 234.000 tourists in 2023. (Gobierno de Mexico, 2024; Grupo SIPSE, 2023).
Thank you for your comment, Mónica! You’re absolutely right— it often feels like as individuals there are limited actions we can take, as this is simply a consequence of the “invisible hand” at work. Further state regulation is needed to protect those most affected by gentrification.
It’s fascinating that you mentioned coastal tourist areas, as they do experience the largest influx of visitors. Reflecting on my own experience, Cancun used to be a tourist hotspot but now it’s perceived as filled with “Gringos,” which has shifted the spotlight to places like Tulum and Bacalar, seen as more authentic and “hip.” If this cycle continues, I can’t help but imagine that these areas will become increasingly gentrified over time, with tourism eventually seeking out newer, more “authentic” beaches elsewhere.