Coyotes, Migration Duration, and Remittances

The migration of Mexican immigrants to the U.S. is one of the largest bilateral migration flows in the world and remittances from these immigrants represent a crucial source of income for Mexican households. As the United States tightens controls on illegal migration, this may impact both migration durations and remittances. Tighter borders increase crossing costs, often because migrants need to pay smugglers (coyotes). Using data from the Mexican Migration Project, we find that higher crossing costs increase the probability of remitting, the remittance rate and the duration of stay as undocumented workers pay off the crossing debt. If immigrants did not incur these crossing debts then more of their earnings could be spent in the United States or by their households in Mexico on productive activities and durations in the U.S. might be lessened at the margin. This suggests some potential gain to both the U.S. and Mexican economies through expanding guest worker programs and consequently reducing the hiring of coyotes.