Motivating revenue flow down the economic pyramid

Abstract

Encouraging remittances to flow despite the usually negative effects of increasing social distance is one of many ways economies with high Gini coefficients might assist those at the bottom of the economic pyramid. Many studies have looked into remittance flows between international and internal migrants and their families. This study examines the extension of these models to encourage remittance flows beyond the traditional family unit to include domestic workers and community schemes through the use of frames. The experimental research utilised a dictator game to investigate the effects of different theoretical conditions on remittance flow in the form of an insurance premium that would benefit a family member, domestic worker or community scheme. Each condition represented an increase in the social distance between the remitter and receiver. A frame was then added to investigate if these flows could be increased by providing the remitter with more information. The study found that people were generally willing to remit to non-family members. It was determined that the proportion of people willing to remit stayed constant in cases where an inter-personal relationship existed, but decreased without such a relationship. The amount a remitter was willing to remit was also found to decrease as social distance increased. The frame used was found not to improve remittance flows regardless of social distance.