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Steady streams and sudden bursts: persistence patterns in remittance decisions

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  • Giulia Bettin

    (Universit… Politecnica delle Marche, MoFiR)

  • Riccardo Lucchetti

    (Universit… Politecnica delle Marche, Dipartimento di Scienze economiche e sociali)

Abstract

This paper is the first systematic attempt to investigate the factors affecting time persistence in remittance behaviour at the individual level. We argue that the time profile of remittance ows from individual migrants is of considerable theoretical relevance and also has very important policy implications. By using micro-level data from the German Socio-Economic Panel (SOEP) we apply a wide variety of discrete choice (static and dynamic) panel models and show that persistence occurs at the individual level due to observable characteristics (individual income, household characteristics, etc.) but also to time-invariant unobserved individual characteristics. In addition, remittance decisions seem to be signi cantly infl uenced by "true state dependence", namely correlation between past actual behaviour and future propensity to remit.

Suggested Citation

  • Giulia Bettin & Riccardo Lucchetti, 2014. "Steady streams and sudden bursts: persistence patterns in remittance decisions," Mo.Fi.R. Working Papers 97, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
  • Handle: RePEc:anc:wmofir:97
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    Cited by:

    1. Giulia Bettin & Riccardo Lucchetti & Claudia Pigini, 2016. "State dependence and unobserved heterogeneity in a double hurdle model for remittances: evidence from immigrants to Germany," Mo.Fi.R. Working Papers 127, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
    2. Bharadwaj, P. & Doiron, D. & Fiebig, D. G. & Suziedelyte, A., 2020. "Psychological Costs of Migration: Home Country Natural Disasters and Mental Health," Working Papers 20/03, Department of Economics, City University London.
    3. Lucchetti, Riccardo & Pigini, Claudia, 2017. "DPB: Dynamic Panel Binary Data Models in gretl," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 79(i08).
    4. 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.
    5. Gabriele Angori & David Aristei, 2020. "Heterogeneity and state dependence in firms’ access to credit: Microevidence from the euro area," SEEDS Working Papers 0220, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Feb 2020.
    6. Pigini, Claudia & Presbitero, Andrea F. & Zazzaro, Alberto, 2016. "State dependence in access to credit," Journal of Financial Stability, Elsevier, vol. 27(C), pages 17-34.
    7. David Aristei & Gabriele Angori, 2022. "Heterogeneity and state dependence in firms’ access to bank credit," Small Business Economics, Springer, vol. 59(1), pages 47-78, June.
    8. Francesco Bartolucci & Claudia Pigini, 2017. "Granger causality in dynamic binary short panel data models," Working Papers 421, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    9. Bettin, Giulia & Lucchetti, Riccardo & Pigini, Claudia, 2018. "A dynamic double hurdle model for remittances: evidence from Germany," Economic Modelling, Elsevier, vol. 73(C), pages 365-377.

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    More about this item

    Keywords

    Discrete panel data models; Migration; Persistence; Remittances; State dependence;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances

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