Are remittance a source of saving and investment in Mexico? A regional analysis of the households' behavior

Abstract

This paper analyzes remittances in the receiver households that have additional incomes from businesses and other sources. It is considered that a household which receives remittances and besides carries out some other economic activity will invest on the improvement or operation of the family business. Based on information from 2004 ENIGH Survey, Probit model and proof of hypothesis are used to estimate the existence of the productive use of remittances at the households, approximating by the savings, financial expenditures and clearance of negative balances. The results do not show differences in the use of remittances from other incomes, however, there is a significant determination on saving and financial expenditures, not so in the clearance of negative balances of own businesses.