The Extensive and Intensive Margins of Migrant Remittances

Remittance behaviour reflects complex economic and social relationships linking migrants and their origin households, yet most empirical studies treat remittances as a unitary outcome without distinguishing between the decision to remit and the intensity of remitting. This paper develops and empirically tests a margin-specific framework that integrates the New Economics of Labor Migration (NELM) and Transnationalism theory to explain distinct dimensions of remittance behaviour. Using original survey data on migrants residing in Italy, the analysis distinguishes between the extensive margin - the activation of remittance behaviour - and the intensive margin - the degree of remittance commitment among remitters. Remittance intensity is operationalized as a multidimensional latent construct derived through Principal Component Analysis, capturing transfer magnitude, frequency and relative economic effort. To address potential selection bias, the intensive margin is estimated within a Heckman selection framework. The results show that the extensive margin is primarily driven by origin-household vulnerability and economic feasibility constraints, consistent with NELM. By contrast, remittance intensity is more strongly associated with transnational embeddedness, return orientation and competing commitments in the destination context. These findings demonstrate that remittance behaviour reflects a sequential and multidimensional process shaped by both contractual obligations and evolving transnational ties.