International Job Search: Mexicans in and out of the U.S.

It is argued that migration from Mexico to the US and return migration are determined by international wage differentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this model by Simulated Method of Moments (SMM) and find that migration practically disappears if Mexico has American arrival rates while employed. Doubling migration costs reduces migration rates in half, while subsidizing return migration in $300 reduces migration rates of older migrants but increases migration rates of younger migrants.International Migration, Job Search, Job Turnover, Savings, Structural Estimation

International Job Search: Mexicans in and out of the US

It is argued that migration from Mexico to the US and return migration are determined by international wage di erentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this model by Simulated Method of Moments (SMM) and nd that migration practically disappears if Mexico has American arrival rates while employed. Doubling migration costs reduces migration rates in half, while subsidizing return migration in $300 reduces migration rates of older migrants but increases migration rates of younger migrants.International Migration, Job Search, Job Turnover, Savings, Structural Estimation. Classification-JEL : F22, J64, E20

The economic impact of international remittances on poverty and household consumption and investment in Indonesia

This paper analyzes the impact of international remittances on poverty and household consumption and investment using panel data (2000 and 2007) from the Indonesian Family Life Survey. Three key findings emerge. First, using an instrumental variables approach to control for selection and endogeneity, it finds that international remittances have a large statistical effect on reducing poverty in Indonesia. Second, households receiving remittances in 2007 spent more at the margin on one key consumption good -- food -- compared with what they would have spent on this good without the receipt of remittances. Third, households receiving remittances in 2007 spent less at the margin on one important investment good -- housing -- compared with what they would have spent on this good without the receipt of remittances. Households receiving international remittances in Indonesia are poorer than other types of households, and thus they tend to spend their remittances at the margin on consumption rather than investment goods.Population Policies,Debt Markets,Remittances,Small Area Estimation Poverty Mapping,Rural Poverty Reduction

The effect of remittances on financial literacy in Mexico

This article studies the impact of remittances on financial literacy and its components using data for ENIF 2021 in Mexico. Using instrumental variables, random matching estimators and non-parametric estimations that control for the endogeneity of remittances and other econometric challenges, the study is the first to find that remittances increase the average level of financial literacy, and its components of financial knowledge, behavior, and attitudes. The effect is not monotonic, since the study finds that remittances reduce the probability of showing high levels of literacy, as well as that of its components of financial knowledge, behavior, and attitudes. Non-parametric estimations show that remittances move the distribution of financial literacy outcomes towards the center of the distribution, which explains why average values of financial literacy outcomes are above the average. These results may indicate that households acquire financial literacy through a process of learning by doing, which shows decreasing returns. They highlight the need for specific policies to increase the level of financial literacy among households that receive remittances. The limitation of the study is the lack of panel data.El efecto de las remesas sobre el alfabetismo financiero en México Este artículo estudia el impacto de las remesas sobre el alfabetismo financieros y sus componentes de conocimiento, comportamiento y actitud usando datos para México provenientes de ENIF 2021. Se utilizan variables instrumento, estimadores emparejados aleatorizados y estimaciones no paramétricas para controlar endogeneidad y otros problemas econométricos. Es el primer estudio en encontrar que las remesas aumentan el nivel promedio de alfabetismo financiero y sus componentes. El efecto no es monotónico pues el estudio encuentra que las remesas reducen la probabilidad de que los individuos muestren altos niveles de alfabetismo, así como de sus componentes. Estimaciones no paramétricas muestran que las remesas mueven la distribución de alfabetismo financiero hacia el centro de la distribución, lo que explica por qué los valores promedios de alfabetismo financiero son mayores que el promedio. Estos resultados pueden implicar que los hogares que reciben remesas aumentan su alfabetismo financiero con la experiencia, la cual es un proceso con retornos decrecientes. Los resultados demuestran la importancia de promover la educación financiera entre la población que recibe remesas. Una limitante es que no se cuenta con datos panel. 

International job search: Mexicans in and out of the US

It is argued that migration from Mexico to the US and its corresponding return migration are determined by international wage differentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this model by Simulated Method of Moments (SMM) and find that migration practically disappears if Mexico has American arrival rates while employed. Doubling migration costs reduces migration rates in half, while subsidizing return migration in $300 reduces migration rates of older migrants but increases migration rates of younger migrants

Do Remittances Increase Borrowing?

While recent literature has pointed out that migrants’ remittances have a positive impact on savings with financial institutions, findings with respect to access to and the use of loans have been ambiguous. This paper investigates whether the reception of remittances facilitates taking up loans from formal or informal sources among Mexican households and finds positive and statistically significant effects of remittances on borrowing and on the existence of debts. We address methodological concerns of selection bias and reverse causality through household fixed effects and an instrumental strategy that exploits distance to train lines and labor market conditions in the US as exogenous determinants of remittances

The impact of remittances on poverty and inequality in Ghana

This paper uses a new, 2005/06 nationally-representative household survey to analyze the impact of internal remittances (from Ghana) and international remittances (from African and other countries) on poverty and inequality in Ghana. To control for selection and endogeneity, it uses a two-stage multinomial logit model with instrumental variables focusing on variations in migration networks and remittances among various ethno-religious groups in Ghana. The paper finds that both internal and international remittances reduce the level, depth, and severity of poverty in Ghana. However, the size of the poverty reduction depends on the type of remittances received. In general, poverty in Ghana is reduced more by international than internal remittances. For households receiving international remittances, the level of poverty falls by 88.1 percent with the inclusion of remittances; for households receiving internal remittances, poverty falls by 69.4 percent with the inclusion of remittances. The paper also finds that both types of remittances increase income inequality in Ghana. For households with internal remittances, the inclusion of remittances causes the Gini coefficient to rise by 4 percent, and for households with international remittances, the inclusion of remittances causes the Gini to increase by 17.4 percent.Population Policies,Access to Finance,Remittances,Debt Markets,Rural Poverty Reduction

Impact of the Covid19 Pandemic on Remittances to Mexico

Impact of the Covid19 Pandemic on Remittances to MexicoEste artículo busca mostrar el impacto de la pandemia COVID-19 sobre las remesas enviadas de Estados Unidos a México. Se utilizan datos mensuales desde enero de 2014 y hasta mayo de 2021, para mostrar que existe un cambio estructural en las ecuaciones de corto y largo plazo que explican las remesas. Utilizando información de funciones de impulso respuesta ortogonalizadas, encontramos que antes del COVID 19 existía evidencia a favor de las hipótesis de enviar remesas por razones altruistas, por motivos de inversión y por motivos de administración del riesgo. Durante el COVID 19, hay evidencia de que el envío de remesas se convirtió en una necesidad, reduciéndose el espacio para el envío de remesas por motivos de inversión o el espacio para las preferencias de los hogares que envían remesas, y aumentando el rol de los motivos de administración del riesgo. Los resultados tienen como principal limitante el no mostrar resultados a nivel de corredor de remesas específico, debido a la falta de datos. Mayores estudios son necesarios para comprender si el COVID 19 tiene impactos de más largo plazo sobre los envíos de remesas y los usos que los hogares receptores hacen de las mismas.This paper seeks to show the impact of the COVID-19 pandemic on remittances from the United States to Mexico. Using monthly data from January 2014 to May 2021, it shows that there is a structural break in the long and short run equations that explain remittances. Using evidence from orthogonalized impulse response functions, we find that before COVID 19 there was evidence in favor of the altruistic, the risk sharing and the investment motive hypotheses for sending remittances. During the COVID 19 period, there is evidence that remittances became more a necessity reducing space for investment motives and the preferences of the sender households and increasing the role of the risk sharing motive. The main limitation of the study is that we do not show results specific to remittances corridors due to the lack of data. Further research is needed to understand if the COVID 19 has long run impacts over the remittance flow and the usage that receiving households give to the remittances.

Remittances, consumption and investment in Ghana

This paper uses a new, nationally-representative household survey from Ghana to analyze within a rigorous econometric framework how the receipt of internal remittances (from within Ghana) and international remittances (from African or other countries) affects the marginal spending behavior of households on a broad range of consumption and investment goods, including food, education and housing. Contrary to other studies, which find that remittances are spent disproportionately on consumption (food and consumer goods/durables) or investment goods (education and housing), the findings show that households receiving remittances in Ghana do not spend more at the margin on food, education and housing than households with similar income levels and characteristics that do not receive remittances. When the analysis controls for endogeneity and selection bias, the findings show that any differences in the marginal spending behavior between remittance-receiving and non-receiving households are explained completely by the observed and unobserved characteristics of households. Households in Ghana treat remittances just like any other source of income, and there are no changes in marginal spending patterns for households with the receipt of remittance income.Population Policies,Access to Finance,Debt Markets,Remittances,

The impact of the components of planned behavior on entrepreneurial intentions among university students in Puebla, Mexico

The objective of this paper is to obtain the impact of the components of the Theory of Planned Behavior (TPB) on the entrepreneurial intention of university students. Using a sample of 336 students from a Technological University in the State of Puebla, México, we calculate four components of Planned Behavior that measure Attitude (AT), Subjective and Social Norms (SSN), Perceived Behavioral Control (PBC), and Attraction to Entrepreneurship (AE). We apply four methodologies to obtain the impact of the treatment of obtaining high scores in the TPB on entrepreneurial intention, using as identification assumption that individuals cannot control the intensity of the score they achieve. Our results show that the PBC is the most important element of TPB in predicting entrepreneurship intentions. The main limitation is that our results apply only for university students in Puebla, Mexico. Our main contribution is the obtention of TPB’s causal impact