Detalles del documento

This note extends the work of Rivera-Batiz (1982) in an attempt to examine the role of remittances in determining the effects of migration on the welfare of the remaining residents in a small open economy producing both traded and non-traded goods. It is shown that if the flow of remittances exceeds a certain critical amount, the remaining residents benefit from migration even if they do not receive any of the remittances themselves. This is in sharp contrast with the results of the Rivera-Batiz model in which the possibility of a gain for the non-migrants is ruled out.