Migration and remittances : an analysis of the determinants of remittances in Mexico

The objective of this thesis is to investigate the determinants of international remittances at a household and community level. It analyses both the determinants of which households that receives remittances and the amount of remittances received. The dataset used for the analysis is provided by the Food and Agriculture Organization of the United Nations (FAO) in Mexico and contains more than 25 000 observations. OLS regression analyses with heteroscedasticity-robust standard errors have been used to analyze the data. Evidence from the analysis suggests that the poorest households are more likely to receive remittances from abroad, while the richest households on average receive a higher amount of remittances. The same relationship is found between agricultural land property and remittances; households with less land have a higher probability of receiving remittances, but they receive on average less than the richer households. No evidence of a migration hump is found. The fact that migrants from wealthier households are inclined to remit more money suggests that Mexican migrants primarily are motivated to remit based on their own self‐interest. However, there is not enough evidence to know this for certain. Additionally, the investigation finds several other significant relationships between household and community variables, and the probability of receiving remittances. Meanwhile factors affecting the amount of remittances received by the households are few; apart from total income and agricultural land property, the age of the head of households is the only variable with a significant impact