Citizenship Status and Remittances: Evidence from German Micro Data
38 Pages Posted: 19 Dec 2008
Date Written: May 1, 2007
Within the framework of a utility maximization model, this paper examines the remittance behaviour of immigrant households in Germany by focusing on changes in their citizenship status. After controlling for endogeneity and taking into account the censored nature of the remittance act (i.e. only 61% of the household observed made remittances and rarely on an annual basis), evidence is found that the citizenship status significantly affects remittances in the case of immigrants from countries which restrict acquisition of real property by foreigners (e.g. Western Balkans). Giving up the citizenship of the home country has a negative effect on the propensity to remit and the amount remitted, while dual-citizenship has a positive effect. The effect vanishes if the migrant source country opens up its real estate market to foreigners (e.g. Turkey, the twelve new EU member states, and the CIS).
Keywords: international migration, remittances, panel data models, Germany, citizenship
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