Remittances and inequality: A meta‐analytic investigation

Abstract

This article provides a comprehensive meta‐analysis that addresses an important gap in the literature by examining the relationship between remittances and inequality in recipient countries. While numerous empirical studies have explored this relationship, there has been no prior attempt to systematically and rigorously synthesise the evidence. This study employs advanced meta‐analysis techniques, such as Bayesian model averaging, to analyse 578 estimates reported in 45 studies. The overall finding is that the effect of remittances on inequality is negative but economically small. However, significant regional variations exist, with remittances contributing to increased inequality in South Asia, while having a substantial inequality‐reducing effect in East Asia, Eastern Europe and Latin America. In the Middle East and North Africa and Sub‐Saharan Africa, only marginal economic impact is found. We recommend that future studies should control for educational attainment, income level and institutional quality to improve the accuracy of their estimates.