What is the Impact of International Remittances on Poverty and Inequality in Latin America?

What is the Impact of International Remittances on Poverty and Inequality in Latin America?

Workers' remittances have become a major source of income for developing countries. However, little is still known about their impact on poverty and inequality. Using a large cross-country panel dataset, the authors find that remittances in La...

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Bibliographic Details
Main Authors:	Acosta, Pablo, Calderón, Cesar, Fajnzylber, Pablo, Lopez, Humberto
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ABSENCE OF REMITTANCES ABSOLUTE TERMS ANNUAL GROWTH ANNUAL GROWTH RATE AVERAGE INCOME AVERAGE INCOME GROWTH AVERAGE INCOME LEVEL BALANCE OF PAYMENT BALANCE OF PAYMENT STATISTICS CAPITA INCOME CAPITA REMITTANCES CAPITAL FLOWS COMPENSATION OF EMPLOYEES CONDITIONAL CONVERGENCE COUNTRY COUNTRY CHARACTERISTICS COUNTRY REGRESSIONS COUNTRY REMITTANCES COUNTRY SPECIFIC COUNTRY-SPECIFIC EFFECTS CROSS-COUNTRY ANALYSIS CROSS-COUNTRY DATA CROSS-COUNTRY PANEL CROSS-COUNTRY STUDIES CUMULATIVE DISTRIBUTION DATA AVAILABILITY DATA ON REMITTANCES DENSITY FUNCTION DEPENDENT VARIABLE DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPING WORLD DEVELOPMENT PRACTITIONERS DIFFERENCE ERROR DISTRIBUTIONAL IMPACT DYNAMIC PANEL DYNAMIC PANEL FRAMEWORK ECONOMETRIC ISSUES ECONOMIC CONDITIONS ECONOMICS ECONOMICS LITERATURE EFFECT OF REMITTANCES EFFECTS OF REMITTANCES ELASTICITY ELASTICITY OF POVERTY EMPIRICAL ESTIMATES EMPIRICAL EVIDENCE EMPIRICAL RESULTS EMPIRICAL SECTION EMPIRICAL WORK ENDOGENOUS VARIABLES EQUALIZING EFFECT ERROR TERM ERROR TERMS ESTIMATED COEFFICIENTS ESTIMATED REDUCTION EXOGENOUS VARIABLE EXPLANATORY VARIABLES EXTENDED FAMILY FAMILIES DUE FAMILY MEMBERS FERTILITY FERTILITY RATE FIXED EFFECTS FLOWS OF REMITTANCES FOREIGN REMITTANCES FUNCTIONAL FORM GDP GINI COEFFICIENT GINI INDEX GLOBAL LEVEL GROWTH GROWTH CONTEXT GROWTH DATA GROWTH EQUATION GROWTH LITERATURE GROWTH MODELS GROWTH OF REMITTANCES GROWTH RATES GROWTH REGRESSION GROWTH REGRESSIONS HEADCOUNT POVERTY HEADCOUNT RATIO HIGH CORRELATION HOME COUNTRIES HOUSEHOLD ASSETS HOUSEHOLD INCOME HOUSEHOLD LEVEL HOUSEHOLD MEMBERS HOUSEHOLD SURVEY DATA HOUSEHOLD SURVEYS IMPACT OF MIGRATION IMPACT OF REMITTANCES INCOME DISTRIBUTION INCOME INEQUALITY INCOME LEVELS INCOME SOURCE INCOME SOURCES INCREASE GROWTH INCREASE IN REMITTANCES INCREASING INCOME INEQUALITY INEQUALITY AVERSION INEQUALITY CHANGES INEQUALITY ELASTICITIES INEQUALITY LEVELS INEQUALITY REGRESSIONS INEQUALITY RESULTS INEQUALITY VARIABLES INTERNATIONAL REMITTANCES LAGGED LEVELS LAGGED VALUES LOG NORMAL LOG-NORMAL APPROXIMATION LOG-NORMAL DISTRIBUTION MACROECONOMIC EFFECTS MEAN INCOME MICRO DATA MIGRANT MIGRANT DESTINATION COUNTRIES MIGRANT FAMILIES MIGRANT FAMILY MIGRANT FAMILY MEMBERS MIGRANT NETWORKS MIGRANT TRANSFERS MIGRANT-SENDING COUNTRIES MIGRANTS MIGRATION MIGRATION FLOWS MIGRATION PATTERNS MINORITY NATIONAL LEVEL NEGATIVE COEFFICIENT 0 HYPOTHESIS OFFICIAL DEVELOPMENT ASSISTANCE PER CAPITA INCOME PER CAPITA INCOME LEVEL PER CAPITA INCOME LEVELS POINT ESTIMATES POLICY RESEARCH POLICY RESEARCH WORKING PAPER POSITIVE EFFECT POSITIVE IMPACT POSITIVE VALUE POVERTY POVERTY GAP POVERTY LEVELS POVERTY LINE POVERTY MEASURES POVERTY REDUCING POVERTY REDUCTION PRACTITIONERS PROGRESS RATES OF GROWTH RECIPIENT HOUSEHOLDS REDUCED INEQUALITY REDUCING INEQUALITY REMITTANCE REMITTANCE RECEIPTS REMITTANCE RECEIVING REMITTANCE SENDER REMITTANCES REMITTANCES FLOWS RESPECT RICHER COUNTRIES SECONDARY EDUCATION SERIAL CORRELATION SIGNIFICANT EFFECT SIGNIFICANT IMPACT SIMULATIONS SQUARED POVERTY GAP WAGES
Online Access:	http://documents.worldbank.org/curated/en/2007/06/7698933/impact-international-remittances-poverty-inequality-latin-america http://hdl.handle.net/10986/7400

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Summary:	Workers' remittances have become a major source of income for developing countries. However, little is still known about their impact on poverty and inequality. Using a large cross-country panel dataset, the authors find that remittances in Latin American and Caribbean (LAC) countries have increased growth and reduced inequality and poverty. These results are robust to the use of different instruments that attempt to correct for the potential endogeneity of remittances. Household survey-based estimates for 10 LAC countries confirm that remittances have negative albeit relatively small inequality and poverty-reducing effects, even after imputations for the potential home earnings of migrants.

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