This paper analyses the impact of migrant remittances on the supply of labour of beneficiaries in a developing country. The model is cast as a two period game between a resident and an altruistic migrant, under imperfect information of the latter about the true economic situation of the former. The game presents a Hybrid Bayesian Equilibrium where at least some residents subject to a good economic situation would behave as if they were disadvantaged, only to manipulate donor's expectations. In some specific circumstances, the resident affected by the bad state of the world may undertake a costly signalling strategy.
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Paper provided by ESSEC Research Center, ESSEC Business School in its series ESSEC Working Papers with number
DR 06005.
Find related papers by JEL classification: D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information F22 - International Economics - - International Factor Movements and International Business - - - International Migration J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
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