Remittances, or money that is sent by a migrant to their home country, have been increasingly viewed as a potential way to economically develop low to middle income countries. Presently, the level of remittances sent is higher than that of official developmental aid. Considering that remittances are private capital utilized by locals, the intervention of a non-profit or large international financial organization to spur developmental projects is perhaps not needed. For countries that are reliant on remittances, there are a considerable number of tradeoffs associated with this inflow of capital. Firstly, although difficult to quantify on a large scale, remittances have thus far not significantly triggered national economic development. For low to middle income countries, remittances are primarily used for basic consumption such as food, education and health care. Secondly, the innate nature of remittances requires that origin countries relinquish power to immigration countries. Origin countries are often powerless to protect their citizens abroad as many find themselves victims of xenophobia and in precarious work conditions. Thirdly, a dependency on remittances reshapes migrants’ national ties. Migrants are more likely to identify as transnational and may be reluctant to return to their origin country. Furthermore, remittances implant a social acceptance that success is only achieved through migrating, discouraging individuals to invest domestically or feel nationally tied. Finally, migration and the receiving of remittances radically impacts individuals differently based on their identity. Women are often unable to migrate and instead typically are the recipients of remittances. However, simply because they have a new access to capital does not eliminate structural barriers and therefore emancipate them from patriarchal structures, but rather may reinforce them. This thesis project is organized in three parts. The first part provides an overview of remittances and why their ramifications are complex and controversial. The second and third part utilize Morocco and Tajikistan as case studies for a deeper analysis of the implications of remittances on development. Morocco and Tajikistan were selected because they are both post-colonial countries that maintain a high dependence on remittances. Morocco is one of the world’s largest recipients of remittances and Tajikistan possesses one of the highest remittance-reliant GDPs in the world. Remittances are important to study because they illuminate how individual survival strategies can have detrimental implications for the nation. This paper argues that remittances provide some degree of individual empowerment but ultimately present problems of national dependency which hinder development. Morocco demonstrates that low to middle income countries must relinquish power over political, economic and social factors when remittances are encouraged. Tajikistan illustrates that remittances may be the most attainable solution for post- colonial countries, yet they provide longer-term problems that deeply entrench historical relations of dependency. Remittance-dependent countries must ultimately find a balance between encouraging their citizens to pursue the best economic opportunities through migration while also thinking critically about how to retain the population to induce national economic growth.
Bachelor of Arts in International Political Economy
Date of Award
Foy, Abby, "Remittances and Development: Local Empowerment and National Dependency" (2020). International Political Economy Theses. 26.