Labor Supply, School Attendance, and Remittances from International Migration: The Case of El Salvador

By Pablo A. Acosta. 2006

361 citations recorded by the source corpus.

The objective of this paper is to present microeconomic evidence on the economic effects of international remittances on households' spending decisions. Remittances can increase the household budget and reduce liquidity constraint problems, allowing more consumption and investment. In particular, remittances can afford investing in children's human capital, a key outcome for the discussion of the perspective of growth in a high recipient developing country. Robust estimates that take into account both selection and endogeneity problems in estimating an average impact of remittances are substantially different from least squares (OLS) estimates presented in previous studies, indicating the importance of dealing with these methodological concerns. After controlling for household wealth and using selection correction techniques such as propensity score matching as well as village and household networks as instruments for remittances receipts, average estimates suggest that girls and young boys (less than 14 years old) from recipient households seem to be more likely to be enrolled at school than those from nonrecipient households. Remittances are also negatively related to child labor and adult female labor supply, while adult male labor force participation remains unaffected on average. The results signaling that the additional income derived from migration increases girls' education and reduces women's labor supply, with no major impact on activity choice for males 14 years or older, suggest the presence of gender differences in the use of remittances across (and possibly, within) households.

Subfields: Gender Studies, Safety Research, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/6e8fedc49a5401bd5d2d556b0ccb924a6bdaae3b

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Citations in the corpus

Remittances, Liquidity Constraints and Human Capital Investments in Ecuador (2009, positive): “In a similar vein, also based on data from El Salvador, Cox and Ureta (2003) find that remittances reduce school dropout hazard rates.”
Migration and Education (2011, neutral): “Similarly, Cox Edwards and Ureta (2003) and Acosta (2006) provide evidence Move and return Stay in home country”
The impact of natural disasters on household income, expenditure, poverty and inequality: evidence from Vietnam (2014, methodology): “Following Mansuri (2006) and Acosta (2006), we use the proportion of households, who are exposed to natural shocks, to total households in a certain district as the instrumental variable for natural shocks.”
Remittances, schooling, and child labor in Mexico (2012, background): “There is evidence from Pakistan, El Salvador, and other Latin American economies that suggests that migration tends to reduce the incidence of child labor and to promote school retention (e.g. Cox Edwards and Ureta, 2003; Acosta, 2006; Mansuri, 2006; Acosta, Fajnzylber and López, 2007).”
Impact of remittances on household income, asset and human capital: evidence from Sri Lanka (2012, background): “Examples of the matching estimator can be found in Acosta (2006) and Esquivel and Huerta-Pineda (2007), who take the second route in estimating the effects of remittance on poverty and education and Mexico and El Salvador, respectively.”
The Effect of Male Migration on Employment Patterns of Women in Nepal (2009, background): “Acosta (2006) looks at the relationships among remittances, labor supply, and school attendance in El Salvador.”
Africa's Money in Africa (2013, background): “Acosta (2006) earlier observed that in such situations, the cost of labour becomes higher and in turn increases per unit cost of production of goods.”
Remittances and the Dutch disease (2009, neutral): “Finally, Acosta (2006), Fajnzylber and López (2008), Funkhouser (1992), and Hanson (2007) in Mexico report that remittances reduce households’ labor supply.4”
Financial development, remittances, and real exchange rate appreciation (2009, background): “Labor supply, school attendance, and remittances from international migration: The case of El Salvador.”
Can migration reduce educational attainment? Evidence from Mexico (2006, background): “Examples of papers that just look at the impact of remittances on education are Acosta (2006) and LópezCórdoba (2005).”
The Impact of Remittances on Poverty and Human Capital: Evidence from Latin American Household Surveys (2007, methodology): “Previous literature has used migration networks as instruments for migration and remittances in order to assess their impact on development outcomes (Hanson and Woodruff, 2003; Lopez-Cordova, 2005; Acosta, 2006; Acosta et al., 2006; Woodruff and Zenteno, 2007).”
Migrants’ International Transfers and Educational Expenditure: Empirical Evidence from Albania (2010, methodology): “The positive link between remittances and school enrolment is reported as well in Acosta (2006) for El Salvador.”