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The good and the bad in remittance flows

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  • Catalina Amuedo-Dorantes

    (San Diego State University, USA, and IZA, Germany)

Abstract

Remittances have risen spectacularly in recent decades, capturing the attention of researchers and policymakers and spurring debate on their pros and cons. Remittances can improve the well-being of family members left behind and boost the economies of receiving countries. They can also create a culture of dependency in the receiving country, lowering labor force participation, promoting conspicuous consumption, and slowing economic growth. A better understanding of their impacts is needed in order to formulate specific policy measures that will enable developing economies to get the greatest benefit from these monetary inflows.

Suggested Citation

  • Catalina Amuedo-Dorantes, 2014. "The good and the bad in remittance flows," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-97, November.
    • Handle: RePEc:iza:izawol:journl:y:2014:n:97
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    References listed on IDEAS

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    1. Dean Yang, 2008. "International Migration, Remittances and Household Investment: Evidence from Philippine Migrants’ Exchange Rate Shocks," Economic Journal, Royal Economic Society, vol. 118(528), pages 591-630, April.
    2. Amuedo-Dorantes, Catalina & Mazzolari, Francesca, 2010. "Remittances to Latin America from migrants in the United States: Assessing the impact of amnesty programs," Journal of Development Economics, Elsevier, vol. 91(2), pages 323-335, March.
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    4. Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Migration, Remittances, and Male and Female Employment Patterns," American Economic Review, American Economic Association, vol. 96(2), pages 222-226, May.
    5. Bugamelli, Matteo & Paternò, Francesco, 2009. "Do Workers' Remittances Reduce the Probability of Current Account Reversals?," World Development, Elsevier, vol. 37(12), pages 1821-1838, December.
    6. Catalina Amuedo-Dorantes & Susan Pozo, 2014. "Remittance income uncertainty and asset accumulation," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-24, December.
    7. Catalina Amuedo-Dorantes & Susan Pozo, 2012. "Remittance Income Volatility and Labor Supply in Mexico," Southern Economic Journal, John Wiley & Sons, vol. 79(2), pages 257-276, October.
    8. Catalina Amuedo-Dorantes & Thitima Puttitanun, 2014. "Remittances and immigration enforcement," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-26, December.
    9. HwaJung Choi, 2007. "Are Remittances Insurance? Evidence from Rainfall Shocks in the Philippines," The World Bank Economic Review, World Bank, vol. 21(2), pages 219-248, May.
    10. Amuedo-Dorantes, Catalina & Pozo, Susan, 2004. "Workers' Remittances and the Real Exchange Rate: A Paradox of Gifts," World Development, Elsevier, vol. 32(8), pages 1407-1417, August.
    11. repec:iza:izawol:journl:y:2014:p:97 is not listed on IDEAS
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    Cited by:

    1. Efobi, Uchenna & Asongu, Simplice & Okafor, Chinelo & Tchamyou, Vanessa & Tanankem, Belmondo, 2016. "Diaspora Remittance Inflow, Financial Development and the Industrialisation of Africa," MPRA Paper 76121, University Library of Munich, Germany.
    2. Blessing Adada Gaiya, 2020. "Issues in the compilation and analysis of remittances in BPM6," IFC Bulletins chapters, in: Bank for International Settlements (ed.), Bridging measurement challenges and analytical needs of external statistics: evolution or revolution?, volume 52, Bank for International Settlements.
    3. Simplice A. Asongu & Nicholas M. Odhiambo, 2020. "Remittances, the diffusion of information and industrialisation in Africa," Contemporary Social Science, Taylor & Francis Journals, vol. 15(1), pages 98-117, January.
    4. Simplice A. Asongu & Nicholas M. Odhiambo, 2022. "Remittances and value added across economic sub-sectors in Sub-Saharan Africa," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(1), pages 23-41, February.
    5. Mduduzi Biyase & Yourishaa Naidoo, 2023. "The Symmetric and Asymmetric Effect of Remittances on Financial Development: Evidence from South Africa," IJFS, MDPI, vol. 11(1), pages 1-17, January.
    6. Akinwumi Sharimakin & Rasheed O. Alao & Oluseyi Omosuyi, 2024. "Foreign remittances, deprivation and patriotism," Quality & Quantity: International Journal of Methodology, Springer, vol. 58(1), pages 753-780, February.
    7. Bucevska Vesna, 2022. "Impact of Remittances on Economic Growth: Empirical Evidence from South-East European Countries," South East European Journal of Economics and Business, Sciendo, vol. 17(1), pages 79-94, June.
    8. Efobi, Uchenna & Asongu, Simplice & Okafor, Chinelo & Tchamyou, Vanessa & Tanankem, Belmondo, 2019. "Remittances, finance and industrialisation in Africa," Journal of Multinational Financial Management, Elsevier, vol. 49(C), pages 54-66.
    9. Elina BENEA-POPUȘOI & Polina ARIVONICI, 2021. "Remittances’ side effects on economy: comparative approach of the Republic of Moldova and other ex-socialist countries," CSIE Working Papers, Center for Studies in European Integration (CSEI), Academy of Economic Studies of Moldova (ASEM), issue 17, pages 26-33, June.
    10. Paulone, Sara & Ivlevs, Artjoms, 2019. "Emigration and alcohol consumption among migrant household members staying behind: Evidence from Kyrgyzstan," Social Science & Medicine, Elsevier, vol. 221(C), pages 40-48.
    11. Hassan B. Ghassan & Hassan R. Alhajhoj & Faruk Balli, 2022. "Bi-demographic and current account dynamics using SVAR model: evidence from Saudi Arabia," Economic Change and Restructuring, Springer, vol. 55(3), pages 1327-1363, August.
    12. Ramkissoon, Benjamin & Deonanan, Regan, 2023. "How do remittances impact child mortality and are there preconditions?," Social Science & Medicine, Elsevier, vol. 333(C).
    13. Ghassan, Hassan & Alhajhoj, Hassan R. & Balli, Faruk, 2018. "Bi-Demographic Changes and Current Account using SVAR Modeling: Evidence from Saudi Arabia," MPRA Paper 93013, University Library of Munich, Germany, revised 01 Feb 2019.
    14. Thomas Yeboah & Emmanuel Frimpong Boamah & Thomas Padi Appai, 2021. "Broadening the Remittance Debate: Reverse Flows, Reciprocity and Social Relations Between UK-Based Ghanaian Migrants and Families Back Home," Journal of International Migration and Integration, Springer, vol. 22(1), pages 47-68, March.
    15. Kpodar, Kangni & Amir Imam, Patrick, 2024. "How do transaction costs influence remittances?," World Development, Elsevier, vol. 177(C).
    16. Francois, John Nana & Ahmad, Nazneen & Keinsley, Andrew & Nti-Addae, Akwasi, 2022. "Heterogeneity in the long-run remittance-output relationship: Theory and new evidence," Economic Modelling, Elsevier, vol. 110(C).
    17. Courage Mlambo & Forget Kapingura, 2020. "Remittances and Economic Development: Evidence from SADC Countries?," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 8(4), pages 261-273.
    18. Elina BENEA-POPUȘOI & Polina ARIVONICI, 2021. "Remittance trap: comparative approach of the Republic of Moldova and other ex-socialist countries," Eastern European Journal for Regional Studies (EEJRS), Center for Studies in European Integration (CSEI), Academy of Economic Studies of Moldova (ASEM), vol. 7(2), pages 59-76, December.
    19. Artjoms Ivlevs, 2021. "Does Emigration Affect Pro‐environmental Behaviour Back Home? A Long‐Term, Local‐Level Perspective," Kyklos, Wiley Blackwell, vol. 74(1), pages 48-76, February.
    20. Catalina Amuedo-Dorantes & Susan Pozo, 2023. "The widespread impacts of remittance flows," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-97, May.
    21. Abokyi, Eric, 2023. "Effects of remittances on financial inclusion gender gap in developing countries," Research in Economics, Elsevier, vol. 77(1), pages 1-24.
    22. José R. Bucheli & Alok K. Bohara & Matías Fontenla, 2018. "Mixed effects of remittances on child education," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 8(1), pages 1-18, December.
    23. Roseline Nyakerario Misati & Anne Kamau & Hared Nassir, 2019. "Do migrant remittances matter for financial development in Kenya?," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 5(1), pages 1-25, December.
    24. Topxhiu Rahmije Mustafa & Krasniqi Florentina Xhelili, 2017. "The Relevance of Remittances in Fostering Economic Growth in the West Balkan Countries," Ekonomika (Economics), Sciendo, vol. 96(2), pages 28-42, February.

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    More about this item

    Keywords

    remittances; remittance income volatility; remittance policy; developing economies;
    All these keywords.

    JEL classification:

    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

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