The Impact of Regional Remittances on Income and Employment in Mexico: An Input-Output Matrix (IOM) approach

Fernando Lozano, Centro Regional de Investigaciones Multidisciplinarias, Unam
Rodrigo Morales, CRIM-UNAM
Marcos Valdivia, CRIM-UNAM

The resources generated by migrants, commonly known as family remittances, have historically played a central role in the economic development of Mexico and its regions. However, the economic impact of remittances in Mexico's states has been analysed using traditional indicators, such as the absolute amount of remittances by state, and the share of remittances in the state's gross domestic product. The objective of this paper is to propose complementary measures to assess the economic impact at the state level generated by the receipt of family remittances. These estimates take into account the impact of the demand of remittance-receiving households on the generation of income and employment in the different Mexican economic sectors. The methodological strategy used is based on the multi-regional input-output model, which takes into account the sectoral and state interrelationships of the Mexican productive structure in order to estimate the economic impact. Preliminary results show that there are a significant number of Mexican states that have historically concentrated the receipt of remittances; however, the impact of this economic flow is not necessarily reflected in their economies, but rather in those states with less migratory activity, but with a much more developed and diversified economic and productive base.

Keywords: International Migration, Economic Demography

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