“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 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.