Manipulating Remittances: Strengthening Autocratic Regimes with Currency Overvaluation and Remittance Flows
Manipulating Remittances: Strengthening Autocratic Regimes with Currency Overvaluation and Remittance Flows

Summary/Abstract: This paper investigates the link between remittances and autocratic regime stability. It challenges the prevailing assumption that remittances cannot be directly captured as a source of hard capital by states. It proposes that remittances increase regime durability by incentivizing and enabling currency overvaluation and seigniorage revenue generation in autocratic states that produce non-freely convertible currencies. It uses cross-national time-series data from autocratic regimes in Sub-Saharan African countries from 1975-2015 to test this theory. The analysis shows that remittances increase autocratic regime durability in countries that have monopoly control over domestic currency production.

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