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The volatility effect of diaspora’s location: A migration portfolio approach

Eric Rougier () and Nicolas Yol

Cahiers du GREThA (2007-2019) from Groupe de Recherche en Economie Théorique et Appliquée (GREThA)

Abstract: Remittances can transmit volatility from migrants’ host countries to migrant’s home country for some common patterns of a country diaspora’s geographical distribution. In a migration portfolio model, the overall risk of volatility of any set of diaspora location is decomposed into a contagion and a concentration risks: a diaspora located in more volatile destinations induces a higher contagion risk, while a diaspora located in few destination countries increases the concentration risk. A series of estimations on a panel of 93 countries over 1995-2015 provide evidence for these two risks and their cumulative effects. Estimation of a structural model confirms that the geography of diaspora has an indirect impact on the origin country’s aggregate instability through remittances.

Keywords: Migration; remittances; macroeconomic volatility (search for similar items in EconPapers)
JEL-codes: F24 F3 F4 F62 F63 J61 O11 O15 O47 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-mig
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