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Remittances to Latin America from Migrants in the United States: Assessing the Impact of Amnesty Programs

  • Amuedo-Dorantes, Catalina

    ()

    (San Diego State University)

  • Mazzolari, Francesca

    ()

    (Centro Studi Confindustria)

The magnitude of remittance flows to Latin America exceeds the combined inflows of foreign direct investment and official development assistance to the region. Since the United States is the destination country of the vast majority of migrants from Mexico, as well as from other Latin American countries, U.S. immigration policy can have a significant impact on the volume of remittances to the Latin American region. This paper studies how a generalized amnesty – a provision in the 1986 Immigration Reform and Control Act (IRCA), affected immigrants' remitting patterns. In models that control for immigrants' length of residence in the United States and for economic conditions in both the U.S. state of residence and the country of origin, we estimate substantial post-legalization drops in remittances sent home by Mexican-born migrants who legalized through IRCA. Given the potential positive impact of remittances on investment levels, entrepreneurship rates and the development of the financial sector, this finding underscores the importance of gaining a better understanding of the impact that immigration policies in immigrant-receiving countries may have on the stream of remittance flows to immigrant-sending communities in developing regions.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4318.

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Length: 43 pages
Date of creation: Jul 2009
Date of revision:
Publication status: published in: Journal of Development Economics, 2010, 91 (2), 323-335
Handle: RePEc:iza:izadps:dp4318
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  7. Pia Orrenius & Madeline Zavodny, 2003. "Do amnesty programs reduce undocumented immigration? Evidence from Irca," Demography, Springer, vol. 40(3), pages 437-450, August.
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  14. Becker, Gary S, 1974. "A Theory of Social Interactions," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1063-93, Nov.-Dec..
  15. Catalina Amuedo-Dorantes & Tania Sainz & Susan Pozo, 2007. "Remittances and healthcare expenditure patterns of populations in origin communities : evidence from Mexico," INTAL Working Papers 1450, Inter-American Development Bank, INTAL.
  16. Jorge Durand & William Kandel & Emilio Parrado & Douglas Massey, 1996. "International migration and development in mexican communities," Demography, Springer, vol. 33(2), pages 249-264, May.
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  18. Dennis Ahlburg & Richard Brown, 1998. "Migrants' intentions to return home and capital transfers: A study of Tongans and Samoans in Australia," Journal of Development Studies, Taylor & Francis Journals, vol. 35(2), pages 125-151.
  19. Dean Yang, 2006. "International Migration, Remittances, and Household Investment: Evidence from Philippine Migrants' Exchange Rate Shocks," NBER Working Papers 12325, National Bureau of Economic Research, Inc.
  20. Shawn Kanaiaupuni & Katharine Donato, 1999. "Migradollars and mortality: The effects of migration on infant survival in Mexico," Demography, Springer, vol. 36(3), pages 339-353, August.
  21. Aggarwal, Reena & Demirguc-Kunt, Asli & Martinez Peria, Maria Soledad, 2006. "Do workers'remittances promote financial development ?," Policy Research Working Paper Series 3957, The World Bank.
  22. Rosenzweig, Mark R, 1988. "Risk, Private Information, and the Family," American Economic Review, American Economic Association, vol. 78(2), pages 245-50, May.
  23. Nicholas P. Glytsos, 1997. "Remitting Behaviour of "Temporary" and "Permanent" Migrants: The Case of Greeks in Germany and Australia," LABOUR, CEIS, vol. 11(3), pages 409-435, November.
  24. Manuela Angelucci & Giacomo De Giorgi, 2009. "Indirect Effects of an Aid Program: How Do Cash Transfers Affect Ineligibles' Consumption?," American Economic Review, American Economic Association, vol. 99(1), pages 486-508, March.
  25. Alejandra Cox Edwards & Manuelita Ureta, 2003. "International Migration, Remittances, and Schooling: Evidence from El Salvador," NBER Working Papers 9766, National Bureau of Economic Research, Inc.
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