Dallas Fed Explores Remittances to Mexico, Cross-Border Banking

Remittances to Mexico, free trade and cross-border banking are the focus of the Federal Reserve Bank of Dallas'latest issue of Southwest Economy (PDF). According to the Fed, "over the last decade or so, inflation-adjusted remittances [to Mexico] have grown at an average annual rate of 15.6 percent. Since 2000, the rate has risen to 20.4 percent."

Lower money-transfer costs and better measurement techniques likely explain the post-2000 growth in remittances from the United States to Mexico, according to Dallas Fed assistant economists Jesus Canas and Roberto Coronado and senior economist and policy adviser Pia Orrenius.
In "Explaining the Increase in Remittances to Mexico," the authors assert that the growth in the Mexican migrant population and their income alone can't account for the increase in remittances. [Read more]