Remittances and Vulnerability in Developing Countries

By Giulia Bettin, A. Presbitero, Nicola Spatafora. 2014

141 citations recorded by the source corpus.

This paper examines how international remittances are affected by structural characteristics, macroeconomic conditions, and adverse shocks in both source and recipient economies. The paper exploits a novel, rich panel data set, covering bilateral remittances from 103 Italian provinces to 87 developing countries over the period 2005-2011. Remittances are negatively correlated with the business cycle in recipient countries and increase especially strongly in response to adverse exogenous shocks, such as natural disasters or large terms-of-trade declines. Financial development in the source economy, which eases access to financial services for migrants and reduces transaction costs, is positively associated with remittances. Conversely, recipient-country financial development is negatively associated with remittances, suggesting that remittances help alleviate credit constraints.

Subfields: Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/70f7d30a6848507e91c0412bf98ae0ba19d84d26

Citations in the corpus

• Why Don't Remittances Appear to Affect Growth? (2014, unknown): “Giuliano and Ruiz-Arranz (2009) find that remittances are typically pro-cyclical for the remittance-receiving country, while Frankel (2011) and Bettin et al. (2014) find that they are typically countercyclical.”