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Remittances, Migrants' Education and Immigration Policy: Theory and Evidence from Bilateral Data

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  • Frédéric Docquier

    ()
    (IRES, Université Catholique de Louvain, and FNRS)

  • Hillel Rapoport

    ()
    (Department of Economics, Bar-Ilan University, EQUIPPE, University of Lille, and Center for International Development, Harvard University)

  • Sara Salomone

    ()
    (IRES, Université Catholique de Louvain, and Tor Vergata University)

Abstract

We investigate the relationship between remittances and migrants' education both theoretically and empirically, using original bilateral remittance data. At a theoretical level we lay out a model of remittances interacting migrants' human capital with two dimensions of immigration policy: restrictiveness, and selectivity. The model predicts that the relationship between remittances and migrants' education is ambiguous and depends on the immigration policy conducted at destination. The effect of education is more likely to be positive when the immigration policy is more restrictive and less skill-selective. These predictions are then tested empirically using bilateral remittance and migration data and proxy measures for the restrictiveness and selectivity of immigration policies at destination. The results strongly support the theoretical analysis, suggesting that immigration policies determine the sign and magnitude of the relationship between remittances and migrants' education.

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Bibliographic Info

Paper provided by Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London in its series CReAM Discussion Paper Series with number 1119.

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Date of creation: Oct 2011
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Handle: RePEc:crm:wpaper:1119

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Keywords: Remittances; Migration; Brain Drain; Immigration Policy;

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  4. Beine, Michel & Docquier, Frederic & Ozden, Caglar, 2009. "Diasporas," Policy Research Working Paper Series 4984, The World Bank.
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Citations

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Cited by:
  1. Simone Bertoli & Hillel Rapoport, 2013. "Heaven's Swing Door: Endogenous skills, migration networks and the effectiveness of quality-selective immigration policies," CReAM Discussion Paper Series 1330, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Diego Alberto Sandoval Herrera & María Fernanda Reyes Roa, 2012. "¿Por qué los migrantes envían remesas?: Repaso de las principales motivaciones microeconómicas," BORRADORES DE ECONOMIA 010036, BANCO DE LA REPÚBLICA.
  3. Alex Julca, 2013. "Can Immigrant Remittances Support Development Finance?," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 60(3), pages 365-380, May.
  4. Giulia Bettin & Andrea Filippo Presbitero & Nikola Spatafora, 2014. "Remittances and vulnerability in developing countries," Mo.Fi.R. Working Papers 93, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
  5. Assaf Razin & Jackline Wahba, 2011. "Welfare Magnet Hypothesis, Fiscal Burden and Immigration Skill Selectivity," NBER Working Papers 17515, National Bureau of Economic Research, Inc.
  6. Vikhrov Dmytro, 2013. "Welfare Effects of Labor Migration," CERGE-EI Working Papers wp491, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
  7. Martin Kahanec, 2013. "Skilled Labor Flows: Lessons from the European Union," Research Reports 1, Central European Labour Studies Institute (CELSI).
  8. Ahmed, Junaid & Martinez-Zarzoso, Inmaculada, 2014. "What drives bilateral remittances to Pakistan? A gravity model approach," Center for European, Governance and Economic Development Research Discussion Papers 209, University of Goettingen, Department of Economics.
  9. Kaczmarczyk, Pawel, 2013. "Money for Nothing? Ukrainian Immigrants in Poland and their Remitting Behaviors," IZA Discussion Papers 7666, Institute for the Study of Labor (IZA).
  10. Kahanec, Martin, 2012. "Report No. 49: Skilled Labor Flows: Lessons from the European Union," IZA Research Reports 49, Institute for the Study of Labor (IZA).

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