Migrants as First Responders: A Global Estimate of Disaster-Driven Remittances

TL;DR

This study quantifies how international remittances respond to environmental disasters globally, revealing their significant yet limited role in disaster finance and resilience building.

Contribution

Develops a structural model to quantify global remittance responses to disasters, providing the first comprehensive macro-financial analysis of migrant remittance behavior during environmental shocks.

Findings

Approximately 332 billion USD remittances responded to disasters from 2010-2019.

Earthquakes caused the largest per-person remittance response.

Droughts elicited the smallest remittance responses.

Abstract

International remittances represent a vital source of disaster adaptation finance for households around the world, yet their responsiveness to environmental disasters remains poorly quantified. We reveal a previously unmeasured global macro-financial system of international migrant diasporas remittances response to the occurrence of disasters in the country of origin. We do so by developing a structural model simulating individual remittance decisions, calibrated with global disaster records and bilateral monthly remittances flow data from the period 2010-2019. Our analysis reveals that approximately 332 billion USD (5.46\% of total remittances) were mobilized specifically in response to earthquakes, floods, storms, and droughts over the decade. Earthquakes triggered the largest remittance responses per person affected, while droughts elicited the smallest. The model also identifies significant variation in diaspora groups' capacity to activate financial support. These findings establish remittances as a substantial yet limited form of disaster finance, highlighting their importance and limitations in building resilience against future environmental shocks.