Insurance and remittances: New evidence from Latin American immigrants to the US

Abstract

This paper examines how the probability of sending remittances and the level of remittances sent are influenced by immigrants’ desire to insure against uncertainty, as opposed to factors that result in remittances with altruistic motives. Using for the first time both 1) data from the Mexican Migration Project and the Latin American Migration Project and 2) the predicted probability of unemployment in the destination country as a measure of immigrants’ economic uncertainty, we find that for Latin American Immigrants insurance motives play a more dominant role than altruistic motives.