Migradollars and Development: A Reconsideration of the Mexican Case

Abstract

"Economic arguments, quantitative data, and ethnographic case studies are presented to counter popular misconceptions about international labor migration and its economic consequences in Mexico. The prevailing view is that Mexico-U.S. migration discourages autonomous economic growth within Mexico, at both the local and national levels, and that it promotes economic dependency. However, results estimated from a multiplier model suggest that the inflow of migradollars stimulates economic activity, both directly and indirectly, and that it leads to significantly higher levels of employment, investment, and income within specific communities and the nation as a whole. The annual arrival of around $2 billion migradollars generates economic activity that accounts for 10 percent of Mexico's output and 3 percent of its Gross Domestic Product."

Repeat Migration and Remittances as Mechanisms for Wealth Inequality in 119 Communities From the Mexican Migration Project Data

“…Our study also did not consider the 'multiplier' effects of remittances. As numerous studies show, migrants' remittances may increase expenditures in the local economy and create new employment opportunities for both migrants and non-migrants (Adams 1998;Cohen 1999;Cohen and Rodriguez 2005;Conway and Cohen 1998;Durand 1994;Durand et al 1996b;Jones 1995;Massey and Parrado 1998;Smith 1998;Taylor et al 1996;Woodruff and Zenteno 2007). These indirect effects, if taken into account, might alter our conclusions about how remittances shape the wealth inequality between migrants and non-migrants in the MMP communities.…”

“…Estimates indicate that international remittances to developing countries have reached US$240 billion annually in 2007, becoming the second largest source of external finance for these countries after foreign direct investment (Ratha and Xu 2008). Remittance flows relax budget and credit constraints of origin households, and create investment opportunities in origin communities (Durand et al 1996a;Durand, Parrado and Massey 1996b;Rapoport and Docquier 2006;Rempel and Lobdell 1978;Stark and Levhari 1982;Taylor 1999). These flows also provide a potential pathway for income redistribution to the most deprived regions of the world (Jones 1998).…”

Migrant remittances and household development: an anthropological analysis

“…The focus of this development logic is typically on productivity R. Eversole and M. Johnson and assets accumulation: Are remittances being used to increase the household's assets, particularly productive assets; and are they being invested in ways that increase the productivity of households' economic activities? These questions have been explored in a range of studies in different national contexts, leading to the broad-brush conclusion that sometimes remittances are invested (and thus, make an important or potentially important contribution to household economic development), but very often they are simply consumed (and thus have little economic development impact) (see, for instance, Durand, Parrado, and Massey 1996;Conway and Cohen 1998;Basok 2000;Francis 2002). The debate on the economic development impacts of remittances for households typically goes in one of three directions.…”

Loans and Leaving: Migration and the Expansion of Microcredit in Cambodia

“…Studies of the relationship between credit and migration are complicated by the very nature of the dilemma: because poor, rural households do not have access to credit and insurance, there is limited empirical basis on which to consider the suggestion that migration is a response to their absence. Research in support of NELM, therefore, has tended to focus on patterns of remittance use, return migration, and business development (Durand et al 1996;Garip 2012;Lindstrom and Lauster 2001;Taylor 1992). Importantly, these studies suggest that for migration to substitute for financial services, some degree of investment opportunity should be present in the community of origin in the first place.…”