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Proceedings of the International Association for Business and Society

Volume 23, 2012

Proceedings of the Twenty-Third Annual Meeting

Michael Barnett, Michael Cummings, Paul Vaaler
Pages 147-159

The Social Dividends of Diaspora
Migrants, Remittances, and Changes in Home-Country Rule of Law

How do societies improve over time? This paper demonstrates one means through which the independent actions of individuals can produce country-level social change. We explain how institutional governance norms, specifically those surrounding rule of law, are transmitted to developing countries through migrants and their remittances. We develop and test an empirical model using a panel dataset of 49 developing countries from 2001-2010. Results suggest that migrants and their remittances matter, but their impact depends on where both reside abroad. Developing countries that suffer a “brain drain” may in some cases be compensated with a social gain.

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