Remittance behaviours of foreigners in Italy

This article investigates the determinants of remittance behaviours among foreigners in Italy and intends to gain a better understanding of the temporal pattern of remittances. The analysis is based on data from the 2009 “Italian Statistics on Income and Living Conditions of Households with Foreigners”. The decisions on whether to remit and how much to remit are separately yet simultaneously estimated using a zero‐inflated beta regression model. The findings reveal that remittances are driven by a mix of altruistic and self‐interest motives that may persist for many years. Many covariates included in the model have a different effect on the propensity to remit and on the relative amount of remittances. We find some evidence that the average propensity to remit follows an M‐shaped trajectory over time. However, the model specification including only time and time squared proves that the inverted‐U shape trajectory, well‐established in the literature, still remains a better choice in terms of parsimoniousness and flexibility. Among those who remit, time since migration does not have any significant effect on the normalized amount remitted.