Migrants’ international transfers and educational expenditure

The primary objective of this article is to cast some light upon the relationship between education expenditure and the volume of remittances sent to Albania from abroad by international migrants. To assess the existence of an education enhancing effect of remittances, an Engel curve framework is used. In addition, quintile regression analysis is employed to investigate whether migrants’ remittances have a differentiated effect on various quantiles of the conditional distribution of education consumption. The two main empirical findings are that household income has a positive and well‐determined impact on education expenditure, whereas international transfers do not influence education spending.     

Consumption Effects of Foreign Remittances in Jamaica

The term remittances refers to proceeds from the migration of labor that are sent to aid individuals remaining in the migrants’ home communities. In this paper, we investigate whether remittances alter the consumption pattern of recipient households in Jamaica. We present results from an Engel curve estimation specifically using the Working (1943) approach and a two-part fractional response model with instrumental variables to account for selection bias and endogeneity of remittances. The dependent variables are a subsample of the categories of consumption as defined in the Jamaican Survey of Living Conditions and include expenditures on food, schooling, health, gambling, alcohol and donations. We find that receipt of remittances significantly alters the recipient households’ expenditure allocations relative to other sources of income, although this effect occurs more through the participation decision. Overall, total effects of remittances are largest in the areas of luxury expenditures and home production, and to a lesser extent for education and grocery store purchases. These findings have significant implications for those remitting, those receiving, and governments looking to understand this large flow and less documented source of income.     

Remittances and healthcare expenditure: Human capital investment or responses to shocks? Evidence from Peru

This paper estimates the effect of international remittances on healthcare expenditures, taking into account both the interdependence with other consumption goods and the effects of health shocks. More precisely, we assess whether the budget allocation decisions of remittance‐receiving households reveal different preferences to invest in health capital, even when the simultaneous effect that health shocks may have on the demand of remittances and on other types of nondurable expenditures is accounted for. Using data from the “Peruvian National Survey of Households,” we find that remittances have a positive impact on healthcare budget shares, net of the remittance‐related income effect and independently of the occurrance of a health shock. They also have a positive impact on housing and a negative one on other expenditure items, that is, clothing, transport, and education. Hence, our results indicate a “pure” tendency of remittance‐receiving households to devote larger shares of their budget to health capital investment, rather than to other types of consumption goods.     

Impact of Internet use on economic well‐being of rural households: Evidence from China

The expansion of the Internet in developing countries has important implications for the economic development of rural areas. Although many studies have investigated various benefits of Internet use, little attention has been paid to find the relationship between Internet use and the economic well‐being of rural households. This paper, therefore, investigates the effects of Internet use on household income and expenditure, using a sample of rural households from China. Both endogenous treatment regression (ETR) and unconditional quantile regression (UQR) techniques are used to identify the homogenous and heterogeneous effects of Internet use, respectively. The ETR results show that Internet use increases household income and expenditure significantly. However, the UQR results reveal that Internet use has a larger impact at the upper distributions of household income and expenditure.     

Remittances channels and the physical growth of Honduran children

Ensuring the availability of food and other resources for young children is important for sustaining physical growth. We examine the role of remittances and its associated implications in determining heights and weights of 4459 children aged 0–5 years in Honduras in 2004. To address the endogeneity problem with household remittance receipt, we take advantage of the timing of Hurricane Mitch in 1998 to construct instrumental variables that are exogenously related to migration decisions made before children included in the later survey were conceived. We find that children are significantly taller and heavier for their age and gender in households receiving remittances. Further investigation of household spending indicates significant changes in food purchases and dietary diversity. Households receiving remittances are more likely to include fish, fruits, and meats in their diets. Additional findings also indicate that households receiving remittances spend absolutely more on food, health care, education, and durable goods. Overall, the findings provide strong evidence that remittances change household consumption and increase children’s body sizes.     

Impact of remittances on household health care expenditure: Evidence from the Nepal Living Standards Survey

This paper examines the effect of remittance inflows on health care expenditure in Nepal using the Nepal Living Standards Survey 2010–2011. Using the recursive three‐stage least square regression method, the propensity score matching method, and the Oaxaca–Blinder decomposition method, we find a positive and significant effect of remittances on health care expenditure. In particular, our analysis shows a 0.099% increase in health care expenditure for every 1% increase in overall remittances. This effect increases to 0.189% for earned remittances (remittances received from a household member). We also find that remittance‐receiving households with at least one migrant family member have different health care spending behavior than those with no migrant members.     

Quantile Regression Analysis of Predictors of Calorie Demand in India: An Implication for Sustainable Development Goals

This study examined predictors of households’ calorie demand using consumer expenditure survey data during the time frame of millennium development goals. It draws suggestions for achieving sustainable development goals to eliminate calorie-poverty. We used the log of per-capita calorie intake as the calorie demand. Endogeneity corrected quantile regression was applied to examine the distributional effect of predictors. Findings revealed calorie-monthly per-capita consumption expenditure (MPCE) elasticities were positively statistically significant across quantiles in rural-and urban-areas, but, contrary to traditional wisdom, elasticities are lower for calorie-poor than calorie-rich households. Dietary diversification of food items, relative food price, and share of medical-and education-expenditure were the main adverse drivers of calorie demand. Our results are robust to the under-reporting and measurement error. The policy implications are: (a) only focusing on pro-poor income enhancing strategies will not able to reduce calorie deprivation, it should be backed by imparting awareness about food choice and nutritional value of low price food items, (b) to implement necessary policy to maintain stable food inflation and effectively targeted food subsidy for calorie poor, (c) to adopt forward-looking medical-and education-policy such as free health and education facilities to all by enhancing public spending to revive the quality of public hospitals and educational institutions.

     

Health care expenditure and economic growth: Quantile panel-type analysis

This study uses international total health care expenditure data of 31 countries from 1986 to 2007 for exploring the causality between an increase in health care expenditure and economic growth. The empirical procedure is divided into two parts. The first is the panel regression analysis and the second is the quantile regression analysis. The estimation of the panel regression reveals that, expenditure growth will stimulate economic growth; however, economic growth will reduce expenditure growth. With regard to the estimation of quantile regression, when economic growth is quantile, in countries with low level of growth, the influence of expenditure growth on economic growth is different. In countries with medium and high levels of economic growth, the influence of expenditure growth on economic growth is positive; when health care expenditure growth is quantile, the influence of economic growth on expenditure growth is more different.     

The Distribution of Household Health Expenditures in Australia*

Out‐of‐pocket health expenditures in Australia are high in international comparisons and have been growing at a faster rate than most other health costs in recent years. This raises concerns about the extent to which out‐of‐pocket costs have constrained access to health services for low income households. Using data from the ABS Household Expenditure Survey 2003–2004, we model the relationships between health expenditure shares and equivalised total expenditure for categories of out‐of‐pocket health expenditures and analyse the extent of protection given by concession cards. To allow for flexibility in the relationship we adopt Yatchew's semi‐parametric estimation technique. This is the first detailed distributional analysis of household health expenditures in Australia. We find mixed evidence for the protection health concession cards give against high out‐of‐pocket health expenditures. Despite higher levels of subsidy, households with concession cards do not have lower out‐of‐pocket expenditures than non‐cardholder households except for the highest expenditure quintile. Cards provide most protection for GP out‐of‐pocket expenditures.     

Inequality in Vietnamese Urban–Rural Living Standards, 1993–2006

We investigate urban–rural inequality in Vietnam using data from the Vietnam Living Standard Surveys between 1993 and 2006. We find that mean per capita expenditure of urban households is consistently twice as much as that of rural households and that the urban–rural gap monotonically increases from the poorer to the richer groups of the expenditure distribution. To isolate factors contributing to the urban–rural gap, we apply the Oaxaca–Blinder type decomposition to a newly developed unconditional quantile regression method. Factors contributing significantly to the high urban–rural gap include inter‐group differences in education, household age structure, labor market activity, geographic location and their related returns, with education playing the most important role. Over the period, consistent with the country's massive rural–urban migration, we find that domestic remittance plays a significant role in shortening the urban–rural expenditure gap in the later years, 2002 and 2006.     

No country for young men: International migration and left‐behind children in Tajikistan

This paper investigates the effects of international migration on the schooling and labour outcomes of left‐behind children in rural Tajikistan. Using three‐wave panel survey data, I rely on an instrumental variable strategy to address the non‐random selection into migration. I identify important and gender‐differenced schooling and labour supply responses. My findings suggest that boys living in migrant households are less likely to lag behind at school or work. At the intensive margin, they also report fewer hours of work per week. On the other hand, left‐behind teenage females undertake a higher number of domestic chores. They appear to marry earlier as well. The migration impact on boys appears to be driven by remittances and the improved financial situation of households. The absence of any positive influence on the education of left‐behind girls is likely to be explained by Tajikistan's cultural norms and institutions.     

Where did all the remittances go? Understanding the impact of remittances on consumption patterns in rural China

We focus on the impact of migrants’ remittances on consumption patterns in China. Using a large homogenous sample of rural households surveyed in 2001 and 2004, we find that remittances are spent on nonhousing consumption expenditures at the margin, virtually dollar-for-dollar, when we instrument remittances and local employed earnings using proxies of social networks. Our findings are robust to intra-household division of labour and to fixed-effect for the county in which the respondents are registered. These results imply that rural households largely take remittances as permanent income and are consistent with the prevalence of circular and repeat migration in China.     

Does Population Aging Hinder the Accumulation of Human Capital? Evidence from China

There is no consensus on the impact of population aging on education investment. To explore this question, we first build an overlapping generations (OLG) model to theoretically analyze the effect of population aging on human capital investment in China, and then test our theory by conducting an empirical study based on micro household data. We find the following. (1) Theoretically, the OLG model shows that population aging has a crowding-out effect on education investment. (2) Empirically, the results show that the share of education and training expenditures decreases by 5.27 percentage points as the ratio of old people in the household increases by 100 percentage points, which confirms the crowding-out effect of population aging on human capital investment. (3) The crowding-out effect is far more intense on urban households than on rural households since health care expenditures will be greater in urban areas as population aging increases. (4) A quantile regression indicates that the negative effect of population aging on the share of educational expenditure is concentrated in households with higher shares of education expenditures. We confirm the robustness of our results using regional fixed effect and instrumental variable (IV) regressions.     

Migrant remittances and fertility

This study examines the role of migrants’ remittances in developing countries’ fertility transition. Employing an unbalanced panel of South Asian countries and controlling for various economic and socio-demographic factors, we find that remittances are significantly associated with a lower number of children born to women of childbearing age. This suggests the remittances’ substitution effect to be at play rather than the income effect, and may result from decreased need for children for financing the household’s future needs as well as from better access to healthcare and contraceptive methods available to migrant households. Remittances’ association with fertility appears to be more important than the transfer of fertility norms from migrants’ host countries. The monetary aspects of international migration may therefore be more important for the region’s demographic transition than social remittances.     

Remittances and the human capital of children: New evidence from Kyrgyzstan during revolution and financial crisis, 2005–2009

We analyze the effect of the receipt of remittances on the education and health of children in Kyrgyzstan during a volatile period of their recent history, 2005–2009. The country experienced revolution in 2005 and the global financial crisis beginning in 2008. Both events impact human capital investment, and the changes vary by region of the country. We use fixed effects estimation and fixed effects, instrumental variables estimation to isolate the effects of remittances and other events on human capital. We find that boys aged 14–18 in remittances’ receiving households are less likely to be enrolled in school than other children. We also find that girls in remittances’ receiving households are more likely to be malnourished (thin). Both effects are relatively small. Remittances do not improve the human capital of children left behind. However, we do find an overall positive improvement in school enrollment among young children between 2005 and 2009 but a negative trend in enrollment among older boys and girls. Nutrition improves over time. Regional differences are apparent in these trends in nutrition and education.     

Intra‐household bargaining power and household expenditure allocation: Evidence from Iran

This article examines the role of intra‐household bargaining power on household expenditure patterns in Iran to see whether women’s empowerment can achieve similar results in Iran as we have seen it achieve in other countries of the world. This study is insightful because it tells us whether Iranian women, who have experienced both economic and noneconomic constraints over many years, can utilize increased power toward economic development. The bargaining power is measured by the sex ratio in the marriage market. Using the Household Income and Expenditure Survey in Iran, we find that greater bargaining power of women contributes significantly toward greater provision of education and health expenditure within the household, creating a potential for an increase in welfare for the next generation.     

Remittances and Household Expenditures on Education in Ghana's Northern Region: Why Gender Matters

Studies of the impact of migrant remittances on receiving households assume that these households act as a unit in receiving remittances and making decisions about their use. Thus, many of these studies use the gender of the household head as a key control variable. This study questions this assumption, using original qualitative and quantitative data on rural–urban migration of women in Ghana to show that gendered social norms of household provisioning influence the intrahousehold flow of remittances. Regression results indicate that migrant women are more likely to send remittances to other women, creating female-centered networks of remittance flows even within male-headed households. The implications of this for intrahousehold resource allocation are explored through an analysis of the impact of the gender of the remitter and recipient on education expenditure. The results show that regardless of the gender of the household head, households in which women are the primary recipient of remittances spend more than twice as much on education as households in which men are the primary recipient.     

EVALUATING THE DISTRIBUTIONAL EFFECTS OF FISCAL POLICIES USING QUANTILE REGRESSIONS

The objective of this paper is to propose and apply a new method to evaluate the distributional impact of fiscal policies and potential marginal reforms. The econometric tool adopted is structural quantile treatment effects regression, which allows a complete picture of the effects of the fiscal policy of interest on households with different incomes, abilities, and needs. We apply this method to personal income taxation and non‐cash transfers in Italy for the year 2004. Our estimates suggest that, although heterogeneous, the redistributive effects of the potential fiscal reforms are almost zero.     

Remittances and financial development in Latin America and the Caribbean countries: A dynamic approach

Despite the importance of remittances in total international flows, the conclusion of the studies on the relationship between remittances and financial development, is still not completely unanimous, particularly in Latin America and the Caribbean. However, financial development matters for growth and poverty alleviation and financial inclusion have many beneficial effects for households. We examine the relationship between remittances and financial sector development with several dynamic panel data methods. We find a positive, significant, and robust bidirectional link between remittances and financial development for the panel of 32 countries.     

Political instability and households’ investment behavior: Evidence from Burkina Faso

There is a large, rather macroeconomic, literature that shows that political instability and social conflict are associated with poor economic outcomes including lower investment and reduced economic growth. However, there is only very little research on the impact of instability on households’ behavior, in particular their saving and investment decisions. We merge six rounds of household survey data and a geo-referenced time series of politically motivated events and fatalities from the Armed Conflict Location and Event Data Base (ACLED) to analyze households’ decisions when exposed to instability in Burkina Faso. For identification, we exploit variation in the intensity of political instability across time and space while controlling for time- and municipality-fixed effects as well as rainfall and nighttime light intensity, and many other potential confounders. Our results show a negative association of political instability and financial savings, the accumulation of durables, investment in house improvements, as well as investment in education and health. Instability seems, in particular, to lead to a reshuffling from investment expenditures to increased food consumption, implying lower growth prospects in the future. With respect to economic growth, the sizable education and health effects seem to be particularly worrisome.