Nova School of Business and Economics and NOVAFRICA, Nova University of Lisbon
Ragnar Frisch Centre for Economic Research
Working Paper No 1402
How do risk preferences affect migrant remittance behaviour? Examination of this relationship has only begun to be explored. Using a tailored representative survey of 1500 immigrants in the Greater Dublin Area, Ireland, we find a positive and significant relationship between risk aversion and migrant remittances. Risk-averse individuals are more likely to send remittances home and are, on average, likely to remit a higher amount, after controlling for a broad range of individual and group characteristics. The evidence we obtain is consistent with a “purchase of self-insurance” motive to remit in that we also find support for more remittances being sent by risk-averse immigrants who face higher wage risks and to individuals with more financial resources.
This paper was published in the Oxford Economic Papers in January 2016, Volume 68, Pages 108–130. You can find the published version of the paper here.