Remittances and incumbency: Theory and evidence

By raising household income, remittances lower the marginal utility of targeted electoral transfers, thus weakening the efficacy of vote buying. Yet, remittances make individuals wealthier and believe the national economy is performing well, which is positively attributed to the incumbent. Building on these insights, I show that the confluence of these divergent channels generate a surprising result that at increasingly higher levels of dissatisfaction with the incumbent, a remittance recipient is more likely to vote for the incumbent than a non-remittance recipient. These predictions and their underlying mechanisms are substantiated across 18 Latin American countries.