Remittances have been the primary preoccupation of studies of Pacific migration and transnationalism for many years as part of a widely-expressed concern about the economic futures of many island countries. The focus has been on remittances of money and goods, and to a lesser extent on what have been referred to in the broader literature on transnationalism as ‘social remittances’, that is, the ideas, values, practices and even identities that move between diaspora and homeland (Levitt and Jaworsky 2007, 132). A range of factors including limited domestic resources, small land masses and geographical isolation, declining commodity prices, limited opportunities to generate income, environmental problems, government policies that create obstacles to change and the rising expectations of the population have all been cited as factors in the creation of a reliance on remittances and foreign aid in order for the small island countries to remain economically viable. This led to a focus in the 1970s on the issue of dependency, generating considerable debate about the role of remittances in the home country (Bedford 1984). A key argument was that remittances were used primarily for consumption and therefore acted as a disincentive to investment and local production, hindering development and creating a dependent relationship between those at home and the migrants (Connell 1980; and see below).

The issue of remittances has recently become a key concern in studies of transnationalism, as shifts in the world economy create increasing opportunities for labour mobility and the generation of remittances. Steven Vertovec, for example, says of remittances:

These are all issues discussed in the literature on Pacific migration and remittances from the late 1960s, and this same tension between the cost and benefits of remittances has been debated in much of the subsequent work. In the mid–1980s some of this work on the Pacific began to draw on the ‘MIRAB model’ developed by Geoff Bertram and Ray Watters, based on the elements of MIgration, Remittances, Aid and Bureaucracy that characterised some Pacific states. Bertram and Watters originally developed the model to describe the island states with colonial links to New Zealand (1985, 1986; Bertram 1986) and as the model gained currency it was used to describe other Polynesian and Micronesian countries with similar economic situations, even countries beyond the Pacific (Bertram 1999).

The MIRAB model emphasises the integration of island economies with ‘the mainland’ (New Zealand in the initial model) and how this process ‘turned the Islands from resources-based into rent-based economies’ (Bertram and Watters 1986, 57). An essential element in this process was migration from the islands so that remittances could be sent to support those at home. Bertram and Watters argued that migration from the Pacific was shaped by the collective decision making of family units in order to maximise benefits to the whole group. Drawing on earlier work on Tonga by George Marcus (1974, 1981) they used the term ‘transnational corporations of kin’ to describe this process (Bertram and Watters 1985, 499). They argue that remittances are sustainable as long as ‘kin corporations’ continue to operate and there is a continuing flow of new migrants.

A substantial literature now exists discussing the pros and cons of the MIRAB model and the question of whether MIRAB economies are sustainable over time. Despite various critiques of the model it continues to be applied and developed to take into account changes within Pacific economies and the importance of social relationships and personal agency (e.g. Bertram 2006; Evans 1999, 2001; Fraenkel 2006; Stahl and Appleyard 2007).