The impact of remittances on development in rural mexico

The Impact of Remittances on Development in Rural Mexican Communities
Mexican migrants have travelled north to the United States in search of employment for over 100 years, it is estimated that around 11.5 million currently reside there (Pew Hispanic centre, 2009). This migration has had many impacts on both Mexican and North American society. One of the greatest of these impacts for Mexico isthe remittances that Mexican immigrants send back home to their families. Statistics tell us that Mexicans received 21,132 million dollars in remittances in 2009 (Inter-American Development Bank, 2010). These figures give us an overview of the magnitude of this phenomenon but tell little if anything about the impact this money can have on the lives of the Mexican people.

In recent decades thehigh increase in remittance flows has sparked huge interest in their potential for development. Development in itself is a complex concept and its sheer meaning is debated widely among academics of all disciplines, for the purpose of this assignment I will look at Amartya Sen’s notion of development as freedom. Sen (1999) approaches development ‘as a process of expanding freedoms that people enjoy’(3). For Sen, freedom is the expansion of the capabilities of people to control their own lives. Sen’s approach contrasts with views on development that associate it with growth of gross domestic product or technological advance. He acknowledges that income can be a great contribution to the expansion of freedoms, but notes that income indicators alone are inadequate to measure the quality ofpeople’s lives. Sen measures development through 5 different types of freedom in his book, however he notes there are more. This assignment will address three of these; economic facilities, social opportunities and political freedoms.

Families and households are direct beneficiaries of remittances; early studies in the 1980’s explored the direct effects of remittances and argued that thesegroups are more likely to spend remittances on current consumption than for productive uses and that in turn remittances lead to dependency and lack of development.

In the early 1980’s Reichert looked at the impact of remittances on Guadelupe, a poor farming community that had 80 years’ experience of migration. He divided the community’s population into three groups; legal migrants, illegalmigrants and non-migrants. Reichert carried out a survey of housing stock and access to consumer goods, and found inequalities among these groups ‘legal migrants occupied the highest economic stratum in Guadalupe followed by illegal immigrants, non-migrants tended to be the poorest people in town’ (Binford, 2003: 307). He found that legal migrants invested in the improvement of the community but at thesame time, they were the ones that mostly benefited from these. In Guadelupe, legal migrants were also investing in land, which provoked a hike in land prices putting land beyond the reach of the most non-migrants. Reichert noted that this growing inequality had an effect on the younger generations who came to see migration as a positive way on enhancing opportunities, which provoked a desire tomigrate instead of carrying on with their education in Mexico. These observations led Reichard to see migration to the U.S as a syndrome ‘households had become dependent on the income from migration, and trapped, perhaps unknowingly, in a vicious circle in which only migration provided the means for sustaining the very materially improved lifestyles that the remittances had made possible’(Binford,2003: 308).

Similar studies were carried out by Wiest (1979) in the rural town of Acuizio, Michoacán and Mines (1981) in the community of Las Animas, Zaxateca, both observations came to similar conclusions to those made by Reihert. Wiest came to view migration from Mexico to U.S as an addiction, his study demonstrates that ‘ migration from Acuzio was accompanied by material improvement,...