Corresponding author

Moawia ALGHALITH, Department of Economics, The University of the West Indies, Port of Spain, Trinidad and Tobago

Co-authors

Samantha Chris ROACH, Department of Economics, The University of the West Indies/College of Science and Technology, Arts and Applied Science of Trinidad and Tobago, Port of Spain, Trinidad and Tobago

A Theoretical Model of Remittances with Applications

Pages

113-120

Abstract

In this paper, we provide a theoretical model of remittances. In doing so, we provide several unique formulas using Taylor’s Theorem to measure the impact of cash remittances on health and education. We then empirically tested the impact of cash remittances on health and education to the Caribbean countries of St. Lucia and Trinidad and Tobago using nonlinear least squares to estimate the parameter coefficients.

The results of the model suggest that remittances impact health and education in both countries. While the impact is positive in St. Lucia for both health and education, it is negative in Trinidad and Tobago. The positive impact on health and education in St. Lucia may perhaps be attributed to the lack of revenue allocated to health care and education. On the other hand, the negative impact on education in Trinidad and Tobago may be attributed to the provision of free education for citizens of Trinidad and Tobago.

JEL classification

F3, E6

Keywords

Remittances, Health, Education, Trinidad and Tobago, St. Lucia

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