Insights on Immigration and Development
Working Papers
Working paper # 16

Remittance Income Volatility and Labor Supply in Mexico

By Catalina Amuedo-Dorantes and Susan Pozo
(February 2010)

Using the 2000-2005 ENIGH, Mexico’s income and expenditure survey, we estimate how the level and uncertainty of international remittance inflows impact the labor supply of men and women in remittance-receiving households. We find that both men and women increase labor supply when remittance inflows are less predictable, although the response of women to increases in remittance income uncertainty appears significantly larger than the labor supply response of men. Since men are more likely than women to be employed and to work full-time, women may be better suited than men to respond to higher remittance income uncertainty with increases in labor supply, either by stepping into the labor market or, if employed, by raising the number of hours worked.


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