The Use of Remittance Income in Mexico

Abstract

Immigration affects sending countries through the receipt of remittance income. The impact of these cash transfers on households and communities has brought attention to remittances as a development mechanism. This study attempts to understand the degree to which household consumption is affected by the receipt of remittance income and the ways in which the broader communities may be impacted. Using household income and expenditure data for Mexico, expenditure patterns of remittance-receiving households are analyzed. Regression analysis indicates that remittance-receiving households spend a greater share of total income on durable goods, healthcare, and housing.