The effects of migrant remittances on consumption in highland Guatemala

Jason Davis, University of California, Santa Barbara
David L. Carr, University of California, Santa Barbara
Laurel K Suter, University of California, Santa Barbara

This paper investigates the potential impact of migrant remittances on consumption in highland Guatemala. The process of international migration, remittances and changing consumption dynamics in migrant sending areas is critical to our understanding of rural development and environmental change. To determine the influence of international migration and remittances on migrant-sending community lifestyle patterns, the first author conducted 89 individual and one group interview in two western Guatemalan Highland communities. For the rural western Guatemalan case study communities captured by this investigation, successful economic migrants are increasing their material consumption. While many informants identify investments in human capital (children’s education and healthcare) and small businesses as common uses of remitted income, almost every informant, first and foremost, mentioned the construction of a new home as the preeminent use of remittances. This finding contradicts our expectations that households would invest first in basic household necessities, suggesting that the economic conditions for international migrant households are superior to those of rural migrants.