Remittances, migrants' education and immigration policy: Theory and evidence from bilateral data

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. We investigate the relationship between remittances and migrants' education both theoretically and empirically, using original bilateral remittance data. At a theoretical level we lay out a model of remittances interacting migrants' human capital with two dimensions of immigration policy: restrictiveness, and selectivity. The model predicts that the relationship between remittances and migrants' education is ambiguous and depends on the immigration policy conducted at destination. The effect of education is more likely to be positive when the immigration policy is more restrictive and less skill-selective. These predictions are then tested empirically using bilateral remittance and migration data and proxy measures for the restrictiveness and selectivity of immigration policies at destination. The results strongly support the theoretical analysis, suggesting that immigration policies determine the sign and magnitude of the relationship between remittances and migrants' education.JEL Classification: F24, F22, O15, J61

Do Transfer Costs Matter for Foreign Remittances? A Gravity Model Approach

“…This shows that Pakistani migrants send more remittances when the economic conditions improve at home, which supports the portfolio investment motive. This result is consistent with the findings in Kock andSun (2011), Lueth andArranz (2008), and Docquier et al (2012). However, remittance flows to Pakistan do not seem to respond to the host country's economic conditions.…”

What Drives Bilateral Remittances to Pakistan? A Gravity Model Approach

“…On the other hand, Faini (2007) suggest that high-skilled migrant's send fewer remittances. Docquier et al (2012) argue that skilled migrant's send more remittances in the presence of more restrictive immigration policies. Unfortunately, in this study, we are unable to use data at a disaggregated level, both on type and skill level of migration, because the data are not available for bilateral flows.…”

The education investment dimension of international personal remittances in Colombia

“…Furthermore, remittances managed to improve the infant mortality rate and life expectancy (Zhunio et al, 2012:4610). However, Docquier et al (2012) observed that remittances had a more positive influence on education in the receiving country if the immigration policy in the destination country is restrictive and vice-versa.…”