EFFECT OF REMITTANCES ON FAMILY RENTAL AND PREDIAL EXPENDITURE IN MEXICO: 2012 AND 2014

Abstract

The expenses of Rent and Predial are indicators that show us if a family lives in a home of rent or own, and informs us about their level of well-being and security. International and national studies show an increase in the proportional expenditure of the aforementioned items as a result of remittances. This paper will analyze the effect of remittances on Rental and Predial expenditures in Mexico by income level, through the National Surveys of Household Income and Expenditure (ENIGH's) for 2012 and 2014, using Engel ́s Curve by Ordinary Least Squares (OLS). It was found that the proportional expenses of Rent and Predial were reduced in the presence of remittances, with the exception of the last quintile of 2012. Proportional expenditure on Rent for households without remittances behaves as a lower good and for households with remittances as a normal good. Proportional spending in Predial for households with and without remittances behaved as a normal good.

Keywords

• Engel curve
• consumption
• distribution of expenditure
• household