Document Type

Article

Publication Date

Spring 2011

Keywords

Stevenson Center, labor, workers, economic freedom, gdp

Abstract

I test the determinants of workers’ remittances, with a focus on how economic freedom in the labor sending country affects the level of remittance inflows the country receives. I use an unbalanced panel data set between years 2000 and 2006. I find a positive and statistically significant relationship between economic freedom and the percentage of GDP from remittances. I show that the effect of economic freedom is dependent upon the level of economic development in the labor sending country (measured by real GDP per capita); as GDP per capita increases, the marginal effect of economic freedom on remittances decreases steadily.

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