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Immigration Policy, Remittances, and Growth in the Migrant-Sending Country

Author

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  • Sylvain Dessy
  • Tiana Rambeloma

Abstract

As evidence accumulates to expose the ineffectiveness of foreign aid, there are increasing calls for rich countries to open up their immigration policies so as to enable migrants' remittances to substitute for foreign aid as a growth-stimulant in poor, migrant-sending countries. In this paper, we use an endogenous growth model to argue that the growth effects of transnational migration and remittances are entirely mediated by the human capital profile of emigrants, as determined by immigration policy at the destination country. Quantitatively, we find that when immigration policy at the destination country provokes a "brain drain", growth is negatively impacted in the sending country despite remittances. The reverse is true when immigration policy targets workers with low levels of human capital.

Suggested Citation

  • Sylvain Dessy & Tiana Rambeloma, 2009. "Immigration Policy, Remittances, and Growth in the Migrant-Sending Country," Cahiers de recherche 0915, CIRPEE.
    • Handle: RePEc:lvl:lacicr:0915
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    File URL: http://www.cirpee.org/fileadmin/documents/Cahiers_2009/CIRPEE09-15.pdf
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    References listed on IDEAS

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    2. Stephen Asafo Agyei, 2021. "The Dynamics of Remittances Impact: A Mixed-Method Approach to Understand Ghana’s Situation and the Way Forward," Social Sciences, MDPI, vol. 10(11), pages 1-21, October.
    3. Oussama Ben Atta & Kamal Kasmaoui & Mazhar Yasin Mughal & Farid Makhlouf, 2021. "More remittances, fewer kids—Impact of remittances on fertility in Morocco," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(8), pages 1238-1256, November.

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    More about this item

    Keywords

    Remittances; migration; growth; education; general equilibrium; child labor;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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