The economic impact of international remittances on poverty and household consumption and investment in Indonesia

By R. H. Adams, Alfredo Cuecuecha. 2010

125 citations recorded by the source corpus.

This paper analyzes the impact of international remittances on poverty and household consumption and investment using panel data (2000 and 2007) from the Indonesian Family Life Survey. Three key findings emerge. First, using an instrumental variables approach to control for selection and endogeneity, it finds that international remittances have a large statistical effect on reducing poverty in Indonesia. Second, households receiving remittances in 2007 spent more at the margin on one key consumption good -- food -- compared with what they would have spent on this good without the receipt of remittances. Third, households receiving remittances in 2007 spent less at the margin on one important investment good -- housing -- compared with what they would have spent on this good without the receipt of remittances. Households receiving international remittances in Indonesia are poorer than other types of households, and thus they tend to spend their remittances at the margin on consumption rather than investment goods.

Subfields: Economics and Econometrics, Safety Research, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/eeb340c78958a32433f5fda28a2db8442d49c036

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Economics and Econometrics

1. R. H. Adams
2. Matthieu Clément
3. Barry Reilly
4. A. Castaldo

In Safety Research

1. R. H. Adams
2. A. Fosu
3. J. Page
4. Mamta B Chowdhury
5. Hein de Haas
6. Claudia Martínez Alvear
7. Dean Yang
8. O. Folarin

In Sociology and Political Science

1. R. H. Adams
2. Maurice Schiff
3. A. Fosu
4. J. Page
5. Hein de Haas
6. Frédéric Docquier
7. Gordon H. Hanson
8. Matthieu Clément

Citations in the corpus

• Evaluating the Economic Impact of International Remittances On Developing Countries Using Household Surveys: A Literature Review (2011, background): “For instance, Barham and Boucher ( 1998 ) in Nicaragua, Rodriguez ( 1998 ) in the Philippines and Adams and Cuecuecha ( 2010a ) in Indonesia construct counterfactual situations and find that the Gini coefficient of inequality increases with the inclusion of remittances in household income.”