BEA’s Measures of Workers’ Remittances and Transfers through Charitable Organizations Michael Mann Chief, Current Account Services Branch Balance of Payments Division Bureau of Economic Analysis (BEA)

BEA’s Measures of Workers’ Remittances and Transfers through Charitable Organizations Workers’ Remittances – a numerical example of BEA’s estimation methodology and source data Transfers through charitable organizations - mostly based on BEA’s BE-40 Survey In BEA’s BOP accounts, we include these two items within a line called “private remittances and other transfers” along with other current transfers under our currents transfers category. www.bea.gov

Workers’ Remittances BEA estimates workers’ remittances by multiplying three factors: Stock of foreign-born population (S) Mean family income (M) Propensity to remit reflecting the average proportion of income remitted (P) BEA’s estimates of workers’ remittances include cash and goods remitted by foreign-born residents of the United States to friends and family in their native born country. Our estimates cover all migrants’ remittances regardless of the source of income or their purpose. Our estimates cover all migrants rather than just “workers” as I will explain in more detail in a moment. www.bea.gov

Factors Arranged by the Following Variables: Family Type Foreign born head of household (FB HH) Native born head of household, foreign born spouse (NB HH, FB S) foreign born individuals (IND) Length of Residency in the United States 5 year intervals 1-5, 6-10, 11-15, 16-20, 21-25, 25-30, 30+ years www.bea.gov

Step 1. Determine the stock of the foreign-born population in the United States This example assumes a total stock foreign-born population of 500 households. Data on population characteristics, such as country of birth, family status, and length of U.S. residency, are extracted from data from the U.S. Census Bureau The surveyed population includes all documented and undocumented (illegal) immigrants who indicated that the U.S. was their usual place of residence.  Therefore, in principle, our estimates cover those who are in the U.S. for less than one year, but intend to stay more than one year. www.bea.gov

Step 2. Determine the mean family income of the foreign-born population in the United States We obtain data on income of the foreign-born population from the U.S. Census Bureau. www.bea.gov

Step 3. Determine the propensity to remit for the foreign-born population in the United States Our estimates of the proportion of income remitted are based on household surveys. Our propensities vary by world region. www.bea.gov

Step 4. Estimate remittances per capita by multiplying average propensity to remit by mean family income www.bea.gov

Step 5. Estimate total remittances by multiplying remittances per capita by the foreign born population in the U.S. www.bea.gov

Transfers through Charitable Organizations BEA collects this information by surveying charitable organizations Captures transfers by foreign-born and U.S.-born population Captures transfers by foreign born to residents of their home country other than their family (e.g. some Tsunami aid) www.bea.gov

Questions www.bea.gov