COVID-19 and remittances to Mexican states
Keywords:Remittances, Health Schocks, COVID-19, Poverty
With the onset of the COVID-19 pandemic and its negative effect on economic activity, a decrease in remittances was expected. However, on the contrary, remittances have increased in countries like Mexico. Using a fixed-effect model with information at the state level, this study finds evidence that the increase in COVID-19 cases was associated with a higher level of remittances to Mexican states, allowing some degree of insurance against the pandemic. However, remittances did not respond to the decrease in employment caused by the pandemic in local economies. A portion of the observed increases in remittances during the pandemic can be explained by factors at the national level.
Akim, A., Ayivodji, F., and Kouton, J. (2021). Do Remittances Mitigate COVID-19 Employment Shock on Food Insecurity? Evidence from Nigeria. Africa Institute for Research in Economics and Social Sciences Working Paper No. 4.
Ambrosius, C., Campos Vázquez, R. M., & Esquivel, G. (2021). What Drives Remittances During a Global Shock? Evidence from the COVID-19 Pandemic in Mexico. Freie Universität Berlin, Fachbereich Wirtschaftswissenschaft Discussion Paper No. 2021/13). https://doi.org/10.17169/refubium-31486
Bettin, G., Presbitero, A. F., and Spatafora, N. L. (2017). Remittances and Vulnerability in Developing Countries. World Bank Economic Review, 31(1), 1–23. https://doi.org/10.1093/wber/lhv053
Combes, J. L., and Ebeke, C. (2011). Remittances and Household Consumption Instability in Developing Countries. World Development, 39(7), 1076–1089. https://doi.org/10.1016/j.worlddev.2010.10.006
Dinarte, L., Jaume, D., Medina-Cortina, E., and Winkler, H. (2021). Not by Land nor by Sea: The Rise of Formal Remittances during COVID-19. https://devpolicy.org/Events/2021/Not-by-land-nor-by-sea-the-rise-of-formal-remittances-during-COVID-19-Dinarte-13Apr/full-paper-updated13Apr.pdf
International Organization for Migration. (2020). COVID-19 Analytical Snapshot #16: International Remittances. Retrieved from https://www.iom.int/sites/g/files/tmzbdl486/files/documents/covid-19_analytical_snapshot_16_-_international_remittances.pdf
Janssens, W., Pradhan, M., de Groot, R., Sidze, E., Donfouet, H. P. P., and Abajobir, A. (2021). The Short-Term Economic Effects of COVID-19 on Low-Income Households in Rural Kenya: An Analysis Using Weekly Financial Household Data. World Development, 138, 105280. https://doi.org/10.1016/j.worlddev.2020.105280
Kpodar, K., Quayyum, S., Gammadigbe, V., and Mlachila, M. (2021). Defying the Odds: Remittances During the COVID-19 Pandemic. IMF Working Papers No. 2021/186. https://doi.org/10.5089/9781513578453.001
Lara, J. (2016). Remittances as an Insurance Mechanism in the Labor Market. Journal of Labor Research, 37(3), 368–387. https://doi.org/10.1007/s12122-016-9226-3
Mbaye, L. M., and Drabo, A. (2017). Natural Disasters and Poverty Reduction: Do Remittances Matter? CESifo Economic Studies, 63(4), 481–499. https://doi.org/10.1093/cesifo/ifx016
Rapoport, H., and Docquier, F. (2006). The Economics of Migrants’ Remittances. In Kolm, S.C., and Mercier Ythier, J. (Eds.) Handbook of the Economics of Giving, Altruism and Reciprocity. https://doi.org/10.1016/S1574-0714(06)02017-3
Shimizutani, S., and Yamada, E. (2021). Resilience Against the Pandemic: The Impact of COVID-19 on Migration and Household Welfare in Tajikistan. PLoS ONE, 16(9), 1–20. https://doi.org/10.1371/journal.pone.0257469
Stark, O., and Bloom, D. E. (1985). The New Economics of Labor Migration. American Economic Review, 75(2), 173–178. https://doi.org/10.2307/1805591
How to Cite
The works published in this journal are subject to the following terms:
1. Oviedo University Press (the publisher) retains the property rights (copyright) of published works, and encourages and enables the reuse of the same under the license specified in paragraph 2.
© Ediuno. Ediciones de la Universidad de Oviedo / Oviedo University Press
2. The works are published in the online edition of the journal under a Creative Commons Attribution-Non Commercial-Non Derives 3.0 Spain (legal text). You can copy, use, distribute, transmit and publicly display, provided that: i) you cite the author and the original source of publication (journal, publisher and URL of the work), ii) they are not used for commercial purposes, iii) mentions the existence and specifications of this license.
3. Conditions of self-archiving. The author can archive the post-print version of the article (publisher’s version) on the author’s personal website and/or on the web of the institution where he belong, including a link to the page of the journal and putting the way of citation of the work. Economics and Business Letters and its URL https://reunido.uniovi.es/index.php/EBL/index are the only authorized source for correctly giving the reference of the publisher’s version in every mention of the article.