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Move, Work, Save, Send: The Political Economy of Migration & Remittances

  • Author(s): Acevedo, Jesse
  • Advisor(s): Rogowski, Ronald L.
  • Lewis, Jeffrey B.
  • et al.
Abstract

This three-paper dissertation is about the relationship between remittances and political institutions in developing countries and how institutions shape emigration flows. I build on the political economy, democratization, and international migration literatures to theorize the political consequences from remittances. Drawing on underutilized surveys and extant cross-national databases, I show that remittance inflows alter citizen preferences on redistribution as well as government spending patterns on health and educational outcomes. In addition, I find that institutional quality in migrant-sending countries shapes emigration lows in times of economic crisis. My findings add to established theories of government redistribution, which are largely based on wealthier, industrialized countries, and the nascent field on the political economy of remittances.

The first paper analyzes how remittance recipients view the role of the state and how citizen attitudes change due to fluctuations in remittance income. I use survey data from the most remittance-dependent countries in Latin America to see how preferences for redistribution changed during the course of the Global Financial Crisis of 2008-2009. With the United States as the main source of remittances, the recession had ripple effects in Latin America. I find remittance receivers are more likely to favor redistribution policies following the economic crisis than before 2009.

The second paper analyzes the political effects of remittances at the country level. I use country-level data to show that the relationship between remittances and government spending is conditional on regime type. Autocratic regimes show greater changes in spending on educational and public health from rising remittances. On the other hand, democracies show mild relationships between remittances and spending. I find that institutions will influence the ways government spending responds to rising remittances.

The final paper argues that political institutions shape emigration flows conditional on economic performance. Using data from the American Community Surveys to measure Latin American migration into the United States, I find that countries with higher quality institutions will experience a brain drain when economic growth is low. I use the example of Venezuela in 2002-2003 when the country saw its intelligentsia emigrate. While economic performance is a strong factor explaining emigration flows, political institutions have the capacity to mitigate or exacerbate them. Together, these three essays show that remittances and migration flows have profound implications for domestic policy, state expenditures, and the consequences of institutional quality and economic crisis.

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