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This article shows that the level and the predictability of remittances reduce working poverty in receiving economies through their effects on labour market dynamics. It takes advantage of the new cross-country dataset (ILO, KILM 7th edition) containing information on the share of individuals working for less than US2 per day. To identify the main impacts, the article proposes a novel approach to deal with the endogeneity of remittances and migration. In addition, the results are robust to the possible error in measuring working poverty, to the potential attrition bias, and to the presence of various control variables.
Combes et al. (Fri,) studied this question.