Template-Type: ReDIF-Paper 1.0
Author-Name: Richard Chisik
Author-X-Name-First: Richard
Author-X-Name-Last: Chisik
Author-Email: rchisik@economics.ryerson.ca 
Author-Workplace-Name: Department of Economics, Ryerson University, Toronto, Canada
Author-Name: Nazanin Behzadan
Author-X-Name-First:  Nazanin  
Author-X-Name-Last: Behzadan
Author-Email: nbehzada@ryerson.ca
Author-Workplace-Name: Department of Economics, Ryerson University, Toronto, Canada
Author-Name: Harun Onder
Author-X-Name-First: Harun    
Author-X-Name-Last: Onder
Author-Email: honder@worldbank.org
Author-Workplace-Name:  The World Bank
Author-Name: Apurva Sanghi
Author-X-Name-First: Apurva     
Author-X-Name-Last: Sanghi
Author-Email: asanghi@worldbank.org
Author-Workplace-Name:  The World Bank
Title: Aid, Remittances, the Dutch Disease, Refugees, and Kenya.
Abstract:  In this paper we show that an important determinant of a foreign
transfer generating a Dutch disease effect is the income of the recipient.
The marginal propensity to consume luxury services is larger for
wealthier recipients who are more likely to receive the benefits of foreign
aid than they are to receive remittances. In a three good model
of international trade with production we show that foreign aid can
generate a Dutch disease and remittances can foster economic growth.
We empirically verify these hypotheses with data from two panels of
data covering the years 1980-2009. The data for Kenya, with its large population of 
displaced person in refugee camps, however, fails to support these propositions. The 
Kenyan data suggests that certain restrictions on refugees reduce the beneficial effect 
of their received remittances on the host economy.
Length: 42 pages
Creation-Date: 2016-02
Number: 062
File-URL: http://economics.ryerson.ca/workingpapers/wp062.pdf
File-Format: Application/pdf
Handle: RePEc:rye:wpaper:wp062