We research the effects of personal remittances sent to a country on that country's degree of income inequality. Based on data we collected for the World Bank Databank from 1970 to present we compared the effect that remittances have on the income share held by the top 20 percent of the population vs their effect on income share held by lowest 20 percent. The results from comparing the two models indicate that personal remittances decrease the spread of income leading to a decrease in the income gap of lower to middle income countries. This is due to their greater effect on the income of the lowest 20 percent over the income of the highest. Our findings are similar to those of previous studies on the effects of remittances on income.
Economics, Finance, & Accounting
Copyright the Author(s)
Heinzen, Lucas and Schreyer, Sam
"How Do Personal Remittances Affect Income Inequality?,"
SACAD: John Heinrichs Scholarly and Creative Activity Days: Vol. 2020, Article 32.
Available at: https://scholars.fhsu.edu/sacad/vol2020/iss2020/32