wrist or arm? / alternate picking

Use the wrist. As you noted, using your arm will tire you out.

Way back when I started to learn tremolo picking, I found the same thing you have - your faster with the arm. When you use your whole arm, your biceps are getting involved, and those are usually a lot more developed than the small muscles of the forearm and hand that are needed for picking from the wrist... but you'll tire awfully quickly.

If you keep at it with the wrist, speed will come.

What is tremolo picking? I have a tremolo pedal. how would you pick causing that effect??

Repeating the same note as quickly as possible.

The beginning of the solo in "La Bamba" starts with a tremolo on G.

Ok thank you Noteboat, that makes sense!