وجوه ارسالی برای توسعه اقتصادی: چشم انداز سرمایه گذاری

Based on the economic theory of the family, this paper constructs a model of remittances where the migrant, besides sending money to his family, also invests in his home country. The investment is looked after by a family member in return for some monetary compensation. The model focuses on two different cases: state-contingent transfers (transfers are tied to investment outcomes) and fixed transfers (transfers are mainly of altruistic motive). As the migrant derives utilities from consumption, his consumption-investment decision is driven by preferences and future investment prospects. The transfers are to increase with both business encouraging and income compensatory effects.

Recently, there has been a substantial increase in remittance flows from developed countries to developing countries. An estimate by the World Bank (2007) indicates that total remittances to developing economies amounted up to $240 billion in 2007 from $31.2 billion in 1990. The actual numbers are surely much larger given the fact that official statistics miss informal inflows. This information suggests that remittances are potentially a good source of finance for economic development, especially for the poorest countries. There is a considerable debate on the role of remittances to economic development process of developing countries. Remittance supporters posit that remittances help improve recipients' standard of living and encourage households' investment in education and healthcare. Remittances are also necessary for financing imports and investment. However, the negative view of remittances indicates that remittances can fuel inflation and reduce recipients' incentive to work which are obviously harmful for growth. Empirical studies on the economic impact of remittances also produce mixed results (see, for example, Chami et al., 2005, Glytsos, 2002 and Leon-Ledesma and Piracha, 2004).

This paper has developed a model which allows it to examine the motivation for sending remittances. Remittances are made both due to altruistic and business doing motivations. It is shown that remittances not only compensate the recipients for unfavorable economic conditions but also serve as an important flow of capital as well as monetary rewards for investment managerial efforts. From macroeconomic stance, this creates two opposing effects of remittances in the relationship with home country's income level. While the compensatory effect results in a negative relationship with income growth which is consistent with the literature, the business encouraging effect is positive since it stimulates remittances for investment purposes. This is a novel aspect of the paper. This aspect makes remittances a potentially important source of finance for economic development. It highlights the role of financial development in mobilizing investment for productive activities from this source of finance.