Remittances and Banking Sector Breadth and Depth : Evidence from Mexico

Despite the rising volume of remittances flowing to developing countries, their impact on banking sector breadth and depth in recipient countries has been largely unexplored. The authors examine this topic using municipio-level data on the fraction...

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Bibliographic Details
Main Authors:	Demirgüç-Kunt, Asli, López Córdova, Ernesto, Martínez Pería, María Soledad, Woodruff, Christopher
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNT HOLDERS ADMINISTRATIVE COST AVERAGE BALANCE AVERAGE EARNINGS BALANCE OF PAYMENTS BANK ACCOUNTS BANK BRANCH BANK BRANCHES BANK CREDIT BANK DEPOSITS BANK POLICY BANKING PRODUCTS BANKING SECTOR BANKING SECTOR DEVELOPMENT BANKING SERVICES BANKS BIASES BRACERO CALCULATIONS CHILD HEALTH COMMERCIAL BANK COMMERCIAL BANK BRANCHES COMMERCIAL BANKING COMMERCIAL BANKS COUNTRIES OF ORIGIN CREDIT LEVELS CREDITS DEMAND FOR CREDIT DEMAND FOR SERVICES DEPOSIT DEPOSIT ACCOUNTS DEPOSIT VOLUME DEPOSITS DEVELOPING COUNTRIES DEVELOPMENT BANK DUMMY VARIABLE DURABLE DURABLE GOODS EARNINGS ECONOMIC ACTIVITY ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC IMPLICATIONS EDUCATION LEVEL EDUCATION LEVELS EDUCATIONAL ATTAINMENT ELECTRONIC TRANSFERS EMPLOYMENT ENTREPRENEURSHIP EXCLUSION EXPENDITURE EXPENDITURES FAMILY MEMBERS FEE INCOME FEE REVENUE FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SERVICES FINANCIAL SERVICES TO INDIVIDUALS FINANCIAL SYSTEM FINANCIAL SYSTEMS FIXED COST FIXED COSTS FUTURES GLOBALIZATION GROSS DOMESTIC PRODUCT HOUSEHOLD SURVEYS HOUSEHOLDS HOUSING IMPACT OF MIGRATION INCOME DISTRIBUTION INCOME LEVELS INCOMES INEQUALITY INFANT INFANT MORTALITY INFORMATION CAMPAIGNS INSTRUMENT INTEREST RATE INTEREST RATE SPREAD INTERNATIONAL BANK INVESTING INVESTMENT FUND LABOR FORCE LABOR FORCE PARTICIPATION LABOR MARKET LACK OF DEVELOPMENT LARGE CITIES LARGE FIRMS LIQUIDITY LOAN LOANABLE FUNDS LONG-TERM SAVINGS MICROENTERPRISES MIGRANT MIGRANT REMITTANCES MIGRANTS MIGRATION MIGRATION FLOWS MONEY TRANSFER NATIONAL LEVEL NUMBER OF HOUSEHOLDS OPERATING COSTS OTHER ASSETS OUTREACH POLICY RESEARCH POLICY RESEARCH WORKING PAPER POPULATION CENSUS POPULATION DENSITY POVERTY LEVELS PROFITABILITY PROGRESS PURCHASES PURCHASING POWER QUESTIONNAIRE REAL ESTATE RECEIPT RECEIPTS RECIPIENT COUNTRIES REGULATORY AUTHORITY REMITTANCE REMITTANCES RENTS RESEARCH ASSISTANCE RESPECT RETURN RETURNS RURAL BANKS RURAL COMMUNITIES RURAL POPULATION RURAL POPULATIONS SAVINGS SMALL ENTERPRISES SMALL-SCALE ENTERPRISES SOCIAL BANKING SOURCE OF CREDIT SOURCE OF INCOME SOURCES OF INCOME SUPERVISORY AGENCY TRANSACTION TRANSACTION COSTS TRANSACTION FEES TRANSPORT TRANSPORTATION TRANSPORTATION INFRASTRUCTURE UNION URBAN AREAS WAGES WAR WIRE TRANSFERS
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090630105142 http://hdl.handle.net/10986/4175

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Summary:	Despite the rising volume of remittances flowing to developing countries, their impact on banking sector breadth and depth in recipient countries has been largely unexplored. The authors examine this topic using municipio-level data on the fraction of households that receive remittances and on measures of banking breadth and depth for Mexico. They find that remittances are strongly associated with greater banking breadth and depth, increasing the number of branches and accounts per capita and the ratio of deposits to gross domestic product. These effects are significant both statistically and economically, even after conducting robustness tests and addressing the potential endogeneity of remittances.

Remittances and Banking Sector Breadth and Depth : Evidence from Mexico

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