Unlocking the Power of Remittances in Mexico: Keys to a Government Strategy for Poverty Reduction
NAVAL WAR COLL NEWPORT RI JOINT MILITARY OPERATIONS DEPT
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The high poverty rate in Mexico depresses the development of human capital and creates a population vulnerable to organized crime and cartels. Remittances, Mexicos second largest source of foreign income, offer opportunities to the low-income families that receive this money. The government of Mexico has enacted a Tres por Uno program in an attempt to magnify the impact of these remittances on local communities, but this plan has proven largely ineffective at decreasing poverty due to arguments over project selection and a lack of project sustainability. Instead, the government should take a lighter hand and strive to shape, rather than direct, how its population uses remittances. The Mexican government should encourage the individual investment of remittances through improving its domestic banking infrastructure and incentivizing investment in small businesses to reduce its national asset-based poverty rate.
- Economics and Cost Analysis
- Government and Political Science
- Sociology and Law