Migration and Remittances in Latin America and the Caribbean: Engines of Growth and Macroeconomic Stabilizers?

82 Pages Posted: 9 Aug 2017

See all articles by Kimberly Beaton

Kimberly Beaton

International Monetary Fund (IMF)

Svetlana Cerovic

International Monetary Fund (IMF)

Misael Galdamez

International Monetary Fund (IMF)

Metodij Hadzi-Vaskov

International Monetary Fund (IMF)

Franz Loyola

International Monetary Fund (IMF)

Zsoka Koczan

International Monetary Fund (IMF); European Bank for Reconstruction and Development (EBRD)

Bogdan Lissovolik

International Monetary Fund (IMF) - European Department

Jan Kees Martijn

International Monetary Fund (IMF)

Yulia Ustyugova

International Monetary Fund (IMF)

Joyce Wong

International Monetary Fund (IMF)

Date Written: June 2017

Abstract

Outward migration has been an important phenomenon for countries in Latin American and the Caribbean (LAC), particularly those in Central America and the Caribbean. This paper examines recent trends in outward migration from and remittances to LAC, as well as their costs and benefits. For the home country, the negative impact from emigration on labor resources and productivity seems to outweigh growth gains from remittances, notably for the Caribbean. However, given emigration, remittance flows play key financing and stabilizing roles in Central America and the Caribbean. They facilitate private consumption smoothing, support financial sector stability and fiscal revenues, and help reduce poverty and inequality, without strong evidence for harmful competitiveness effects through shifts in the real exchange rate.

Keywords: Dominica, Dominican Republic, Caribbean, Costa Rica, Antigua and Barbuda, Asia and Pacific, Bahamas, The, Barbados, Belize, El Salvador, Grenada, Guatemala, Haiti, Honduras, Jamaica, Latin America, Nicaragua, Panama, Trinidad and Tobago, Western Hemisphere, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Remittances, International Migration

JEL Classification: F22, F24, O54

Suggested Citation

Beaton, Kimberly and Cerovic, Svetlana and Galdamez, Misael and Hadzi-Vaskov, Metodij and Loyola, Franz and Koczan, Zsoka and Lissovolik, Bogdan and Martijn, Jan Kees and Ustyugova, Yulia and Wong, Joyce, Migration and Remittances in Latin America and the Caribbean: Engines of Growth and Macroeconomic Stabilizers? (June 2017). IMF Working Paper No. 17/144, Available at SSRN: https://ssrn.com/abstract=3014054

Kimberly Beaton (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Svetlana Cerovic

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Misael Galdamez

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Metodij Hadzi-Vaskov

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Franz Loyola

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Zsoka Koczan

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

European Bank for Reconstruction and Development (EBRD) ( email )

One Exchange Square
London, EC2A 2EH
United Kingdom

Bogdan Lissovolik

International Monetary Fund (IMF) - European Department

700 19th Street NW
Washington, DC 20431
United States

Jan Kees Martijn

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Yulia Ustyugova

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Joyce Wong

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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