Remittances and emigration intentions: Evidence from Armenia

Abstract

AbstractEmigration intentions and effects of international migration constitute important yet understudied directions of contemporary migration research. In this paper, we analyse a recent migration wave in Armenia, using household‐level representative data from 2011. We identify determinants of emigration intentions within a model framework with endogenous remittances, instrumented by community‐level factors such as budget revenue, budget transparency and community remoteness. We find that remittances help potential migrants to ease the migration process, serving as a resource rather than as a contractual tool between migrants and non‐migrants. Also, remittance recipients with high emigration intentions are more likely to be located in poor communities. When distinguishing the destination country for potential migrants, post‐Soviet versus Western countries (EU countries or USA), we find that the instruments identified for remittances are more relevant for individuals targeting the post‐Soviet area (mainly Russia). Nevertheless, remittances remain a significant resource for migrating to Western countries. The two pools of potential migrants considerably differ in the main set of skill characteristics: high‐skilled potential migrants opt for Western countries (brain drain), while the low‐skilled prefer post‐Soviet countries as a destination. We discuss our results from the socio‐economic development perspective, such as the threat of chain migration inherent to poor communities and the whole country. Our findings contribute to the understanding of the relationship between migration and remittances for countries with similar settings.