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The impact of COVID‐19 government responses on remittances in Latin American countries
Author(s) -
Cardozo Silva Adriana R.,
Diaz Pavez Luis R.,
MartínezZarzoso Inmaculada,
NowakLehmann Felicitas
Publication year - 2022
Publication title -
journal of international development
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.533
H-Index - 66
eISSN - 1099-1328
pISSN - 0954-1748
DOI - 10.1002/jid.3606
Subject(s) - latin americans , remittance , covid-19 , economics , containment (computer programming) , exchange rate , demographic economics , government (linguistics) , pandemic , economic recovery , development economics , monetary economics , macroeconomics , economic growth , political science , medicine , linguistics , philosophy , disease , pathology , computer science , infectious disease (medical specialty) , law , programming language
Workers' remittances declined sharply as the COVID‐19 pandemic spread in the first half of 2020, rebounding in the second half. This paper analyses the impact of containment and economic support measures on remittances sent to Latin America during 2019–2020 using a gravity model estimated with the Poisson pseudo‐maximum likelihood estimator (PPML). Results show that containment measures in receiving countries mainly explain the fall in remittance flows, whereas the effect of economic support measures is not robust. Among the traditional explanatory factors, the business cycle and the real exchange rate in receiving countries explain the subsequent recovery of remittances.