Estimating the Determinants of Remittances Originating from U.S. Households Using CPS Data

39 Pages Posted: 29 Jul 2019

Date Written: July 2019

Abstract

The U.S. is the largest source country of remittances with an outflow of more than $70 billion estimated for 2016 (according to data from the World Bank). This paper is the first to use Current Population Survey (CPS) data to estimate the determinants of remittances originating from the United States for a diverse set of approximately 3,800 households with at least one foreign-born worker. We employ a gravity model examining the role of various push, pull, and distance factors. Most notably, higher household earnings push monetary transfers abroad: We estimate an average earnings elasticity in the range of 0.20-0.30. Remittances are more responsive to earnings in households with more adult women relative to men.

Keywords: immigration, remittances

JEL Classification: F24, J61

Suggested Citation

Simpson, Nicole and Sparber, Chad, Estimating the Determinants of Remittances Originating from U.S. Households Using CPS Data (July 2019). IZA Discussion Paper No. 12480, Available at SSRN: https://ssrn.com/abstract=3427619

Nicole Simpson (Contact Author)

Colgate University ( email )

13 Oak Drive
Hamilton NY 13346, NY 13346
United States

Chad Sparber

Colgate University ( email )

13 Oak Drive
Hamilton NY 13346, NY 13346
United States

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