This paper examines the effects that capital inflows have on the financial system in a Diamond-Dybvig environment. Here, an adverse-selection problem arises where short-term capital has the incentive to enter the domestic banking system while long-term capital chooses to stay out. Then,...

The Mexican migration flow to the United States—one of the largest in human history—inverted in the late 2000s, and during the next decade more Mexicans returned home than those who migrated north. We exploit this historical reversal to estimate the effects of return migration on economic...

In 2007, for the first time since the Great Depression, more migrants returned to Mexico than those that migrated to the United States. We exploit this sharp flow reversal to examine whether return migration has played a role in reducing inequality and poverty while increasing income. We...

This paper builds a banking environment where both fundamental runs (that stress macroeconomic variables, such as negative technology shocks, as the cause of bank runs) and sunspot runs (where self-fulfilling expectations generate equilibria where agents panic and run on banks) coexist. A policy...

We develop a model where investment in infrastructure complements private investment. We then provide time series evidence for Mexico on both the impact of public infrastructure on output, and on the optimality with which levels of infrastructure have been set. In particular, we look at the...