The Golden Rule of Capital Accumulation with Workers Remittances

Nicolas Destrée

Annals of Economics and Statistics, 2020, issue 137, 31-64

Abstract: This paper studies the impact of workers remittances on capital accumulation. We consider an overlapping-generations economy in which labor is endogenous and education is paid by parents. Children can migrate to another country and altruistically send remittances to family. In the recipient country, remittances reduce labor supply, domestic savings and capital accumulation with a country-specific impact on the gap between the competitive long-run equilibrium and the optimum. Appropriate taxes and subsidies allow a government to decentralize the optimum. We calibrate the model for 30 recipient countries to quantify the impact of remittances and the policy recommendation.

Keywords: Remittances; Overlapping Generations; Endogenous Labor Supply; Capital Accumulation; Golden Rule; Taxation. (search for similar items in EconPapers)
JEL-codes: C62 F24 H21 O11 (search for similar items in EconPapers)
Date: 2020
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Working Paper: The Golden Rule of Capital Accumulation with Workers' Remittances (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:adr:anecst:y:2020:i:137:p:31-64

DOI: 10.15609/annaeconstat2009.137.0031

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