New Evidence on the Role of Remittances on Health Care Expenditures by Mexican Households

45 Pages Posted: 15 Dec 2009

See all articles by Catalina Amuedo-Dorantes

Catalina Amuedo-Dorantes

San Diego State University - Department of Economics; IZA Institute of Labor Economics

Susan Pozo

Western Michigan University - Department of Economics

Abstract

Using Mexico's 2002 wave of the Encuesta Nacional de Ingresos y Gastos de los Hogares (ENIGH), we find that international remittances raise health care expenditures. Approximately 6 pesos of every 100 peso increment in remittance income are spent on health. The sensitivity of health care expenditures to variations in the level of international remittances is almost three times greater than its responsiveness to changes in other sources of household income. Furthermore, health care expenditures are less responsive to remittance income among lower-income households. Since the lower responsiveness may be partially due to participation of lower-income households in public programs like PROGRESA (now called Oportunidades), we also analyze the impact of remittances by health care coverage. As expected, we find that households with some kind of health care coverage - either through their jobs or via participation in PROGRESA - spend less of remittance income increments on health care than households lacking any health care coverage. Hence, remittances may help equalize health care expenditures across households with and without health care coverage.

Keywords: remittances, health care, household expenditures, Mexico

JEL Classification: F24, I1

Suggested Citation

Amuedo-Dorantes, Catalina and Pozo, Susan, New Evidence on the Role of Remittances on Health Care Expenditures by Mexican Households. IZA Discussion Paper No. 4617. Available at SSRN: https://ssrn.com/abstract=1522685

Catalina Amuedo-Dorantes (Contact Author)

San Diego State University - Department of Economics ( email )

5500 Campanile Drive
San Diego, CA 92182
United States
619-594-1663 (Phone)
619-594-5062 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Susan Pozo

Western Michigan University - Department of Economics ( email )

1903 West Michigan Avenue
Kalamazoo, MI 49008
United States
269-387-5553 (Phone)
269-387-5637 (Fax)

HOME PAGE: http://homepages.wmich.edu/~pozo/

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