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Remittances and the Prevalence of Working Poor

Listed author(s):
  • Jean-Louis COMBES

    ()

    (Centre d'Etudes et de Recherches sur le Développement International(CERDI))

  • Christian EBEKE

    ()

  • Mathilde MAUREL

This paper focuses on the relationships between remittances and the share of individuals working for less than 2$ US per day. It is based on an original panel dataset containing information related to remittances in about 80 developing countries and to the number of workers being paid less than 2 dollars per day as well. Even after factoring in the endogeneity of remittance inflows the results suggest that remittances lead to a decrease in the prevalence of working poor in receiving economies. This effect is stronger in a context of high macroeconomic volatility but is mitigated by the unpredictability of remittances: remittances are more effective to decreasing the share of working poor when they are easily predictable. Moreover, domestic finance and remittances appear as substitutes: remittances are less efficient in reducing the prevalence of working poor whenever finance is available.

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Paper provided by CERDI in its series Working Papers with number 201109.

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Length: 37
Date of creation: 2011
Handle: RePEc:cdi:wpaper:1248
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