like to add a few comments on possible minimum wage hikes in mexico. minimum wages are a feature common to most countries, and mexico is no exception, with the level set by a national commission for all jurisdictions. what is particular to our country is a notable deterioration of this indicator in the 1980s and 1990s due to high and unstable inflation. this process yielded lower purchasing power for all salaries and underscores the vital necessity of protecting the significant ground gained in the last decade in the battle to control inflation, and of consolidating this progress. what effects would minimum wage hikes have in mexico? the economic literature on competitive labor markets suggests that rises in real minimum wages can hurt employment and training, especially of young and unskilled laborers, and promote informality. also, there may be some pass - through from these increases to prices of final goods and services. the degree of these and other impacts remains an empirical issue. 3 in the case of mexico, these effects could be material, for at least two reasons. first, negotiations of private - sector contractual salaries have tended to take into account minimumwage revisions as a floor reference, although the two are not automatically tied. the wage contagion could reflect partly a substitution effect away from less - skilled workers, a phenomenon observed in many countries. 4 second, the minimum wage serves as an index for myriad legal purposes, including fines, tax exemptions, public pensions, government - sponsored mortgages, and many private contracts. wage contagion and indexation would broaden the possible negative real effects on the economy. furthermore, significant minimum wage hikes may contaminate the process of price formation. these adjustments could trigger a chain reaction on inflation expectations, complicating the challenges for the bank of mexico in getting inflation to converge to its permanent target. to handle the risk from indexation, complicated legal changes and cumbersome contract revisions would be called for. 5 for empirical evidence on the possible effects of minimum wage increases, see, for example, neumark, d. and w. wascher ( 2008 ), minimum wages. cambridge, ma : the mit press ; neumark, et al. ( 2013 ), “ revisiting the minimum wage - employment debate : throwing out the baby with the bathwater? ” nber working paper 18681 ; and meer, j. and j. west ( 2013 ), “ effects of the minimum wage on employment dynamics. ” nber working

and progress on financial inclusion in mexico there are several factors that may explain the low level of financial inclusion in mexico. the greatest problem for financial intermediaries appears to reside in the high costs of servicing low - income communities, especially those in isolated locations. see bis ( 2012 ), statistics on payment, clearing and settlement systems in the cpss countries, january ; the world bank, enterprise survey ; and central banks. according to recent data, 36 percent of mexican adults save in the formal system, while 44 percent save in the informal system. at the same time, 28 percent have formal credit, while 34 percent seek loans in the informal sector. see inegi ( 2012 ), encuesta nacional de inclusion financiera. analisis de los resultados, inegi, pp. 20 – 27. bis central bankers ’ speeches in fact, geographic distances, low population density, and the small size of the market make it more burdensome for banks to open branches and other service channels. additionally, low balances and high - volume transactions make accounts expensive to administer. where loans are concerned, limited information on individuals and firms as well as poor guarantees and recovery mechanisms can make lending unprofitable. on the other hand, product designs inadequate to the needs of users also limit financial inclusion. from the perspective of potential customers, practical reasons and cultural barriers exist, as manifested by distrust in banks. many people cite as reasons for not using financial institutions the facts that fees are high and interest rates on savings low, excessive requirements are demanded, and branches are far away. definitely, the benefits of formal financial intermediation have not been well communicated, nor has a more effective response been offered by financial intermediaries to certain potential customer needs. 3 nevertheless, in recent years, mexico has continued to increase the availability of financial services for ever greater numbers of families and businesses. for example, intermediaries have expanded their physical infrastructure to provide services, and to widen and diversify product offerings. similarly, the use of electronic transactions has increased significantly, substituting less efficient means of payment such as checks. one piece of remarkable progress has been the growth of commission agents, through which businesses can provide financial services on behalf of banks, allowing them to take advantage of already built infrastructure, lower their costs, and promote inclusion in faraway populations. to highlight the contribution of this phenomenon, it is enough to say that currently, in more than 10 percent of the nation ’