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Remittances in Small Island Developing States

Author

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  • Catalina Amuedo-Dorantes
  • Susan Pozo
  • Carlos Vargas-Silva

Abstract

We examine how remittances relate to the exchange rate, natural disasters and foreign aid focusing on Small Island Developing States (SIDS). Using panel VAR methods, we are able to compensate for both data limitations and endogeneity issues. While remittances respond to innovations in the macroeconomic variables included in the analysis, remittances also have important impacts on these variables. Furthermore, the impact of remittances differs in SIDS economies relative to the set of all developing economies. Remittances appear to depreciate the real exchange in SIDS economies, whereas they appreciate the real exchange rate when a broader sample of economies is considered.

Suggested Citation

  • Catalina Amuedo-Dorantes & Susan Pozo & Carlos Vargas-Silva, 2010. "Remittances in Small Island Developing States," Journal of Development Studies, Taylor & Francis Journals, vol. 46(5), pages 941-960.
    • Handle: RePEc:taf:jdevst:v:46:y:2010:i:5:p:941-960
    DOI: 10.1080/00220381003623863
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    Cited by:

    1. Giulia Bettin & Amadou Jallow & Alberto Zazzaro, 2023. "How Do Monthly Remittances Respond to Natural Disasters in Migrants’ Home Countries?," CSEF Working Papers 673, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    2. Shastri, Shruti, 2022. "The impact of infectious diseases on remittances inflows to India," Journal of Policy Modeling, Elsevier, vol. 44(1), pages 83-95.
    3. Bernard Poirine & Vincent Dropsy, 2019. "Diaspora growth and aggregate remittances: an inverted-U relationship?," Applied Economics, Taylor & Francis Journals, vol. 51(11), pages 1151-1165, March.
    4. Quy Ta & Yothin Jinjarak & Ilan Noy, 2022. "“How Do Shocks Affect International Reserves? A Quasi-Experiment of Earthquakes”," Open Economies Review, Springer, vol. 33(5), pages 945-971, November.
    5. Mbaye, Linguère Mously & Zimmermann, Klaus F., 2015. "Environmental Disasters and Migration," IZA Discussion Papers 9349, IZA Network @ LISER.
    6. Zubin Deyal, 2024. "Weathering the storm: investigating the role of remittances as immediate disaster relief in developing countries," CSAE Working Paper Series 2024-01, Centre for the Study of African Economies, University of Oxford.
    7. Nadia Eldemerdash & Steven T. Landis, 2023. "The Divergent Effects of Remittance Transfers for Post-Disaster States," Economics of Disasters and Climate Change, Springer, vol. 7(3), pages 483-501, November.
    8. Bettin, Giulia & Jallow, Amadou & Zazzaro, Alberto, 2025. "Responding to natural disasters: What do monthly remittance data tell us?," Journal of Development Economics, Elsevier, vol. 174(C).
    9. Oluwasheyi S. Oladipo, 2020. "Migrant Workers' Remittances And Economic Growth: A Time Series Analysis," Journal of Developing Areas, Tennessee State University, College of Business, vol. 54(4), pages 75-88, October-D.
    10. Edward M Feasel & Nobuyuki Kanazawa, 2013. "Sentiment toward Trading Partners and International Trade," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 39(3), pages 309-327.
    11. Ben Page & Claire Mercer, 2012. "Why do people do stuff? Reconceptualizing remittance behaviour in diaspora-development research and policy," Progress in Development Studies, , vol. 12(1), pages 1-18, January.
    12. Mbaye, Linguere Mously & Zimmermann, Klaus F., 2016. "Natural Disasters and Human Mobility," International Review of Environmental and Resource Economics, now publishers, vol. 10(1), pages 37-56, November.
    13. Farid Makhlouf & Refk Selmi, 2024. "‘From aspirations for climate action to the reality of climate disasters’: Can remittances play key role in disaster response?," The World Economy, Wiley Blackwell, vol. 47(8), pages 3487-3510, August.
    14. Osberghaus, Daniel, 2019. "The Effects of Natural Disasters and Weather Variations on International Trade and Financial Flows: a Review of the Empirical Literature," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 3, pages 305-325.

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