"Walking ATMs": Do Crime Rates Affect Remittances of Mexican Migrants in the United States?

This study investigates the relationship between migrant savings, remittances, and crime. Using a model in which the migrant maximizes utility over the choice of storing savings in the United States or in Mexico, the migrant's decision is determined in part by the potential of losing part of hi...

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Bibliographic Details
Published in:Eastern economic journal 2015-01, Vol.41 (1), p.6-23
Main Author: Coon, Michael
Format: Article
Language:English
Subjects:
Bank accounts
Burglary
Consumption
Cost control
Crime
Criminal statistics
Earnings
Economic models
Economic theory
Economic Theory/Quantitative Economics/Mathematical Methods
Economics
Economics and Finance
F24
Foreign labor
Household utilities
Households
Immigrants
K49
Labor economics
Legislation
Migrant workers
Noncitizens
O15
Remittances
Robbery
Social conditions & trends
Studies
Utility functions
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Description
Summary:This study investigates the relationship between migrant savings, remittances, and crime. Using a model in which the migrant maximizes utility over the choice of storing savings in the United States or in Mexico, the migrant's decision is determined in part by the potential of losing part of his income to theft. Using probit and Tobit analysis I test this model, finding evidence that higher probabilities of victimization lead migrants to alter their remitting behavior. In particular, I find that increased robbery rates reduce the size and incidence of remittances, whereas increased burglary rates increase the size and incidence of remittances.
ISSN:0094-5056
1939-4632
DOI:10.1057/eej.2014.12