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A Model of Foreign-Born Transfers: Evidence from Canadian Micro Data

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Author Info
Don J. DeVoretz (RIIM, Simon Fraser University and IZA Bonn)
Florin P. Vadean () (HWWA Hamburg and RIIM, Simon Fraser University)
Abstract

This paper models financial transfers outside the household for both the Canadian-born and foreign-born Canadian populations in a traditional expenditure framework. Using survey data we estimate transfer functions as part of a larger expenditure system and calculate Engel elasticities for remittances by both the Canadian and foreign-born populations. We conclude that transfers outside the household are a normal good for recent Asian immigrants and a luxury good for all other immigrants and Canadians. Immigrant transfers upon arrival are greater than Canadian-born transfers indicating a strong entry effect. Assimilation or convergence to the Canadian-born norm over time is however very slow. We also find evidence of negative foreign-born transfers as sending country households remit to Canadian immigrant households. Finally, all foreign-born groups generally consider remittances to charitable organizations a greater necessity than inter-household transfers.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1714.

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Length: 37 pages
Date of creation: Jul 2005
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Handle: RePEc:iza:izadps:dp1714

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Keywords: immigration remittances

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Find related papers by JEL classification:
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Cox, Donald, 1987. "Motives for Private Income Transfers," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 508-46, June. [Downloadable!] (restricted)
  2. Cox, Donald & Rank, Mark R, 1992. "Inter-vivos Transfers and Intergenerational Exchange," The Review of Economics and Statistics, MIT Press, vol. 74(2), pages 305-14, May. [Downloadable!] (restricted)
  3. Shamsuddin, Abul F M & DeVoretz, Don J, 1998. "Wealth Accumulation of Canadian and Foreign-Born Households in Canada," Review of Income and Wealth, Blackwell Publishing, vol. 44(4), pages 515-33, December.
  4. Lucas, Robert E B & Stark, Oded, 1985. "Motivations to Remit: Evidence from Botswana," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 901-18, October. [Downloadable!] (restricted)
  5. Bauer, Thomas & Sinning, Mathias, 2005. "The Savings Behaviour of Temporary and Permanent Migrants in Germany," CEPR Discussion Papers 5102, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  1. Mathias Sinning, 2007. "Determinants of Savings and Remittances – Empirical Evidence from Immigrants to Germany," Ruhr Economic Papers 0023, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen. [Downloadable!]
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