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

Frédéric Docquier, Hillel Rapoport, Sara Salomone

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44 Scopus citations

Abstract

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.

Original languageEnglish
Pages (from-to)817-828
Number of pages12
JournalRegional Science and Urban Economics
Volume42
Issue number5
DOIs
StatePublished - Sep 2012

Bibliographical note

Funding Information:
This research was jointly supported by the Agence Française de Développement (AFD) and the World Bank (Development Research Group) . We are grateful to Leonardo Becchetti, Michel Beine, Giuseppe de Arcangelis, Yves Zenou and an anonymous referee for useful comments. We also thank the scholars and organizations who graciously allowed us to use their bilateral remittances data, and participants at the Third Migration and Development conference held at the Paris School of Economics in September 2010 for comments and suggestions. Frédéric Docquier and Sara Salomone acknowledge financial support from the ARC convention on “Geographical Mobility of Factors” (convention 09/14-019 ).

Keywords

  • Brain drain
  • Immigration policy
  • Migration
  • Remittances

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