The Unassuming Economist

From a new IMF report:

“Remittances outweigh the sum of augmented emigration loss and education expenditure for nearly half of the 31 countries in this sample. Most of these countries are from Central America. The countries for which remittances are not able to outweigh the above sum are mostly the Caribbean ones.

Of course, these results need to be qualified by the fact that there are other costs and benefits of emigration which have not been included in this framework, for e.g. the impact on trade, investment and marginal productivity of capital, and some others which are harder to measure. Other characteristics like demography, civil unrest, and natural disasters have also not been captured. The value of elasticity of factor price of skilled labor may be different from that of overall labor. Estimating country‐level elasticities would better capture country characteristics, but is subject to the availability of detailed survey data.”