Remittances and Labour Source Countries 1

Historically, the major motives for emigration stand out as employment, study/skill improvement and refugee/asylum-seeking. Huge disparities in earning potential between advanced and developing countries, especially in the twentieth century, have prompted a large number of migrants to move toward the former countries. Globalization is increasing the volume of migrants across the world but, as the net migration statistics in the 1990–1995 period show, the volume of net settlers is not great (Ramamurthy, 2003). Research on the impact of emigration of labour source countries addresses three main issues – brain drain, remittances and the labour markets in the source countries (Ramamurthy, 2003). ² This chapter addresses the impact of remittances on the labour source countries. A general theoretical treatment precedes an empirical overview and a continent-wise literature review on remittance flows.