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Remittances and Vulnerability to Poverty in Rural Mexico

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  • de la Fuente, Alejandro

Abstract

International remittances have been portrayed as the human face of globalization given their potential to alleviate poverty by directly increasing household income. Using a panel of rural households in Mexico from October 1998 to November 2000 this study assesses whether this is in fact the case. However, rather than examining whether transfers income would reduce future consumption poverty we asked if transfers are likely to reach people whose conditions are prone to worsen in the future. We used vulnerability to consumption poverty to quantify the extent to which risks and the more permanent disadvantages embedded in most rural livelihoods, can translate into future declines in well-being. We found, contrary to our expectations, a negative and statistically significant relationship between the remittance of transfers, including foreign remittances, and the threat to future poverty that rural households could experience.

Suggested Citation

  • de la Fuente, Alejandro, 2008. "Remittances and Vulnerability to Poverty in Rural Mexico," WIDER Working Paper Series 017, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:rp2008-17
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    File URL: http://www.wider.unu.edu/sites/default/files/rp2008-17.pdf
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    References listed on IDEAS

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    1. Cesar Calvo & Stefan Dercon, 2005. "Measuring Individual Vulnerability," Economics Series Working Papers 229, University of Oxford, Department of Economics.
    2. Ravallion, Martin & Dearden, Lorraine, 1988. "Social Security in a "Moral Economy": An Empirical Analysis for Java," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 36-44, February.
    3. Lucas, Robert E B & Stark, Oded, 1985. "Motivations to Remit: Evidence from Botswana," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 901-918, October.
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    Cited by:

    1. de la Fuente, Alejandro, 2010. "Remittances and Vulnerability to Poverty in Rural Mexico," World Development, Elsevier, vol. 38(6), pages 828-839, June.
    2. TCHAMANBÉ DJINÉ Louise, TDL & MIAMO WENDJI Clovis, MWC, 2012. "Transferts Financiers des Migrants et développement en Afrique subsaharienne," MPRA Paper 38139, University Library of Munich, Germany.
    3. Ahortor, Christian R.K. & Adenutsi, Deodat E., 2008. "The impact of remittances on economic growth in small-open developing economies," MPRA Paper 37109, University Library of Munich, Germany.

    More about this item

    Keywords

    globalization; risk; vulnerability; poverty; private transfers; Mexico;

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