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Economic Resources, Financial Aid and Remittances

Author

Listed:
  • Boulanger Martel, Simon Pierre

    () (University of Montreal)

  • Pelling, Lisa

    (Arena Idé)

  • Wadensjö, Eskil

    () (Stockholm University)

Abstract

According to the World Bank, in 2017, an estimated 450 billion US dollars in remittances were sent to Low and Middle Income Countries. This means that the sum of remittances is more than three times larger than the sum of the world's total official aid to the same countries. The practice of sending remittances can be seen as one specific thing that migrants do as part of sustaining ties with their countries of origin. Remittances can be personal gifts, but are often sent in order to support family members and friends in their country of origin living under more difficult economic conditions. Remittances may also be a form of investment or repayments of loans. In this study we use data from the latest Swedish level of living survey LNU-UFB to study the factors influencing the propensity to remit. Using probit estimations, we find that the economic situation of the migrant, demographic variables and the migrants' ties to the home country are important. The propensity to remit also varies by country of origin. With an increasing number of migrants, the propensity to remit will have growing policy implications. It will have implications for Sweden as a donor country, raising issues of complementarity between remittances and official development aid. Migrants' propensity to remit will also be increasingly relevant for Sweden's integration policies, as the motives to remit might shape immigrants' decisions and priorities while settling in Sweden.

Suggested Citation

  • Boulanger Martel, Simon Pierre & Pelling, Lisa & Wadensjö, Eskil, 2018. "Economic Resources, Financial Aid and Remittances," IZA Discussion Papers 11552, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11552
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    References listed on IDEAS

    as
    1. Dean Yang, 2011. "Migrant Remittances," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 129-152, Summer.
    2. Dilip Ratha & Gemechu Ayana Aga & Ani Silwal, 2012. "Remittances to Developing Countries Will Surpass $400 Billion in 2012," World Bank Other Operational Studies 17062, The World Bank.
    3. Jørgen Carling & Marta Bivand Erdal & Cindy Horst, 2012. "How does Conflict in Migrants’ Country of Origin Affect Remittance-Sending? Financial Priorities and Transnational Obligations Among Somalis and Pakistanis in Norway," International Migration Review, Wiley Blackwell, vol. 46(2), pages 283-309, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    migration; remittances; foreign born;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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