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Remittances and the Brain Drain Revisited: The Microdata Show That More Educated Migrants Remit More

Author

Listed:
  • Bollard, Albert

    () (Stanford University)

  • McKenzie, David

    () (World Bank)

  • Morten, Melanie

    () (Yale University and Federal Reserve Bank of Minneapolis)

  • Rapoport, Hillel

    () (Paris School of Economics)

Abstract

Two of the most salient trends surrounding the issue of migration and development over the last two decades are the large rise in remittances, and an increased flow of skilled migration. However, recent literature based on cross-country regressions has claimed that more educated migrants remit less, leading to concerns that further increases in skilled migration will hamper remittance growth. We revisit the relationship between education and remitting behavior using microdata from surveys of immigrants in eleven major destination countries. The data show a mixed pattern between education and the likelihood of remitting, and a strong positive relationship between education and the amount remitted conditional on remitting. Combining these intensive and extensive margins gives an overall positive effect of education on the amount remitted. The microdata then allow investigation as to why the more educated remit more. We find the higher income earned by migrants, rather than characteristics of their family situations explains much of the higher remittances.

Suggested Citation

  • Bollard, Albert & McKenzie, David & Morten, Melanie & Rapoport, Hillel, 2009. "Remittances and the Brain Drain Revisited: The Microdata Show That More Educated Migrants Remit More," IZA Discussion Papers 4534, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp4534
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    References listed on IDEAS

    as
    1. Robinson, Peter M, 1988. "Root- N-Consistent Semiparametric Regression," Econometrica, Econometric Society, vol. 56(4), pages 931-954, July.
    2. Riccardo Faini, 2007. "Remittances and the Brain Drain: Do More Skilled Migrants Remit More?," World Bank Economic Review, World Bank Group, vol. 21(2), pages 177-191, May.
    3. Rapoport, Hillel & Docquier, Frederic, 2006. "The Economics of Migrants' Remittances," Handbook on the Economics of Giving, Reciprocity and Altruism, Elsevier.
    4. Faini, Riccardo, 2006. "Remittances and the Brain Drain," IZA Discussion Papers 2155, Institute for the Study of Labor (IZA).
    5. Luis Miotti & El Mouhoub Mouhoud & Joel Oudinet, 2009. "Migrations And Determinants Of Remittances To Southern Mediterranean Countries: When History Matters !," Post-Print hal-00483303, HAL.
    6. repec:adr:anecst:y:2010:i:97-98:p:06 is not listed on IDEAS
    7. World Bank, 2008. "The Migration and Remittances Factbook 2008," World Bank Publications, The World Bank, number 6383.
    8. Cox, Donald & Eser, Zekeriya & Jimenez, Emmanuel, 1998. "Motives for private transfers over the life cycle: An analytical framework and evidence for Peru," Journal of Development Economics, Elsevier, pages 57-80.
    9. Cox, Donald, 1987. "Motives for Private Income Transfers," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 508-546, June.
    10. Yoko Niimi & Caglar Ozden & Maurice Schiff, 2010. "Remittances and the Brain Drain: Skilled Migrants Do Remit Less," Annals of Economics and Statistics, GENES, issue 97-98, pages 123-141.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    remittances; migration; brain drain; education;

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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