Remittances and Inequality

Abstract

The impact of remittances on inequality is uncertain a priori. However, at the margin, remittances are likely to be more inequality increasing (or less inequality decreasing) in poorer as opposed to richer areas. This is suggested with a simple theoretical model, and tested empirically using survey-based estimates of the Gini income elasticity of remittances in Honduras. The results are robust to alternative distribution weights used for measuring inequality.Migration, Remittances, Income Distribution.