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Remittance Receipt and Business Ownership in the Dominican Republic


  • Catalina Amuedo-Dorantes
  • Susan Pozo


Using household-level data from the Dominican communities in the Latin American Migration Project (LAMP-DR7), we examine the links between remittance receipt and business ownership. We find that while the existence of a family business attracts remittance inflows, these monetary funds are associated with a reduced likelihood of business entrepreneurship. These results are consistent with various hypotheses regarding remittances and business investments. First, remittances may be motivated by the availability of investment opportunities in the home community. Second, remittances may respond to a bequest motive on the part of the emigrant, who may wish to lay claim on family assets when returning home. Lastly, remittances may cause an income effect that reduces family labour force participation and, correspondingly, the likelihood of family-run business investments. Copyright 2006 The Authors Journal compilation 2006 Blackwell Publishing Ltd.

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  • Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Remittance Receipt and Business Ownership in the Dominican Republic," The World Economy, Wiley Blackwell, vol. 29(7), pages 939-956, July.
  • Handle: RePEc:bla:worlde:v:29:y:2006:i:7:p:939-956

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    References listed on IDEAS

    1. Arghyrou, Michael G & Tsoukalas, John D., 2010. "The Option Of Last Resort: A Two-Currency Emu," Cardiff Economics Working Papers E2010/14, Cardiff University, Cardiff Business School, Economics Section.
    2. Michael G. Arghyrou & Georgios Chortareas, 2008. "Current Account Imbalances and Real Exchange Rates in the Euro Area," Review of International Economics, Wiley Blackwell, vol. 16(4), pages 747-764, September.
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    Cited by:

    1. Amuedo-Dorantes, Catalina & Georges, Annie & Pozo, Susan, 2008. "Migration, Remittances and Children’s Schooling in Haiti," IZA Discussion Papers 3657, Institute for the Study of Labor (IZA).
    2. Karla Borja, 2014. "Social Capital, Remittances and Growth," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 26(5), pages 574-596, December.
    3. Adnan KHURSHID & Yin KEDONG & Adrian Cantemir CALIN & Oana Cristina POPOVICI, 2016. "Do Remittances Hurt Domestic Prices? New Evidence from Low, Lower-Middle and Middle–Income Groups," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 95-114, December.
    4. John Gibson & David McKenzie & Steven Stillman, 2011. "The Impacts of International Migration on Remaining Household Members: Omnibus Results from a Migration Lottery Program," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1297-1318, November.
    5. Susan Pozo & José R. Sánchez-Fung & Amelia U. Santos-Paulino, 2010. "Economic Development Strategies in the Dominican Republic," WIDER Working Paper Series 115, World Institute for Development Economic Research (UNU-WIDER).
    6. repec:eee:wdevel:v:99:y:2017:i:c:p:230-252 is not listed on IDEAS
    7. Garcia, Pablo M & Rodriguez-Montemayor, Eduardo, 2010. "A primer of international migration: The Latin American experience and a proposal for a research agenda," MPRA Paper 24147, University Library of Munich, Germany.
    8. Fatma MABROUK & Jacob ODUOR & Abebe SHIMELES, 2015. "Remittances and Youth Labor Market Participation in Africa," Cahiers du GREThA 2015-32, Groupe de Recherche en Economie Théorique et Appliquée.
    9. Juna Miluka & Gero Carletto & Benjamin Davis & Alberto Zezza, 2010. "The Vanishing Farms? The Impact of International Migration on Albanian Family Farming," Journal of Development Studies, Taylor & Francis Journals, vol. 46(1), pages 140-161.
    10. Mahé, Clothilde, 2016. "Skills and entrepreneurship: Are return migrants 'Jacks-of-all-trades'?," MERIT Working Papers 071, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    11. Finkelstein Shapiro, Alan & Mandelman, Federico S., 2016. "Remittances, entrepreneurship, and employment dynamics over the business cycle," Journal of International Economics, Elsevier, vol. 103(C), pages 184-199.
    12. Petreski, Marjan & Jovanovic, Branimir, 2013. "Do Remittances Reduce Poverty and Inequality in the Western Balkans? Evidence from Macedonia," MPRA Paper 51413, University Library of Munich, Germany.
    13. Alarcón, Silverio & Ordóñez, Jessica, 2015. "Ecuador: return from migration and entrepreneurship in Loja," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    14. Eduardo Rodríguez-Montemayor & Pablo M. García, 2009. "A Primer of International Migration: The Latin American Experience," IDB Publications (Working Papers) 9327, Inter-American Development Bank.
    15. BORJA, Karla, 2013. "Home And Host Country Business Cycles And Remittances: The Case Of El Salvador And The Dominican Republic," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 13(2), pages 101-118.
    16. Xing, Chunbing & Wei, Yinheng, 2017. "Does Migrating with Children Influence Migrants’ Occupation Choice and Income?," ADBI Working Papers 647, Asian Development Bank Institute.
    17. Eduardo Rodríguez-Montemayor & Pablo M. García, 2009. "A Primer of International Migration: The Latin American Experience," IDB Publications (Working Papers) 2544, Inter-American Development Bank.
    18. Mahe, Clotilde, 2017. "Occupational choice of return migrants: Is there a 'Jack-of-all-trades' effect?," MERIT Working Papers 039, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    19. Yashodhan Ghorpade, 2016. "Extending a Lifeline or Cutting Losses? Conflict and Household Receipts of Remittances in Pakistan," HiCN Working Papers 236, Households in Conflict Network.
    20. Meseguer, Covadonga & Lavezzolo, Sebastián & Aparicio, Javier, 2016. "Financial remittances, trans-border conversations, and the state," LSE Research Online Documents on Economics 68273, London School of Economics and Political Science, LSE Library.
    21. Jadotte, Evans & Ramos, Xavier, 2015. "The Effect of Remittances on Labour Supply in the Republic of Haiti," IZA Discussion Papers 9541, Institute for the Study of Labor (IZA).
    22. Jeffrey A. Edwards & Jennis J. Biser, 2011. "The interactive effect of remittances and civil liberties on investment and consumption," International Journal of Development Issues, Emerald Group Publishing, vol. 10(1), pages 20-33, April.
    23. Cris Beauchemin & Lama Kabbanji & Bruno Schoumaker, 2009. "Entre parcours de vie des migrants et attentes politiques, quel co-développement en Afrique subsaharienne," Working Papers 166, Institut National d'Études Démographiques (INED).
    24. Jadotte, Evans, 2009. "International Migration, Remittances and Labour Supply: The Case of the Republic of Haiti," WIDER Working Paper Series 028, World Institute for Development Economic Research (UNU-WIDER).

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