Accès libre

Remittances and Household Investment Decisions: Evidence from sub-Saharan Africa

Md Shahadath Hossain
Md Shahadath Hossain
 et 
Adesola Sunmoni
Adesola Sunmoni
   | 19 avr. 2022
IZA Journal of Development and Migration's Cover Image
À propos de cet article
Article précédent
Article suivant
Citez
Publié en ligne: 19 avr. 2022
Pages: -
Accepté: 11 mars 2022
DOI: https://doi.org/10.2478/izajodm-2022-0004
Mots clés
© 2022 Md Shahadath Hossain et al., published by Sciendo
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Substitutability of investments

Invested on physical capital or social capital Invested on human capital or social capital Invested on human capital or physical capital
Human capital Physical capital (=1 if yes) Social capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4)
Panel-A: Uganda
Received remittances (=1 if yes) 0.022 (0.036) 0.074 (0.066) 0.018** (0.008) 0.032 (0.021)
Mean of the outcome variable 0.769 0.872 0.124 0.314
Observations 576 576 1,480 1,468
Panel-B: Kenya
Received remittances (=1 if yes) 0.064 (0.068) 0.022 (0.115) 0.108*** (0.026) 0.177*** (0.016)
Mean of the outcome variable 0.672 0.811 0.152 0.470
Observations 882 882 1,545 1,516
Panel-C: Nigeria
Received remittances (=1 if yes) 0.177*** (0.033) −0.049* (0.027) 0.131*** (0.024) −0.179*** (0.005)
Mean of the outcome variable 0.758 0.844 0.184 0.391
Observations 986 986 1,874 1,884
Panel-D: Burkina Faso
Received remittances (=1 if yes) 0.155*** (0.029) 0.197*** (0.018) −0.181*** (0.018) 0.147*** (0.017)
Mean of the outcome variable 0.672 0.901 0.235 0.661
Observations 1,331 1,331 1,834 1,800
Panel-E: Senegal
Received remittances (=1 if yes) 0.011 (0.066) −0.006 (0.052) 0.018 (0.058) 0.208*** (0.023)
Mean of the outcome variable 0.678 0.853 0.099 0.748
Observations 1,282 1,282 1,651 1,584

Non-linear effect of remittances amount on household investment expenditure

2SLS 2SLS
Human capital Log (Physical capital expenditure) Log (Social capital expenditure) Human capital Log (Physical capital expenditure) Log (Social capital expenditure)
Log (Education expenditure) Log (Health expenditure) Log (Education expenditure) Log (Health expenditure)
(1) (2) (3) (4) (5) (6) (7) (8)
Panel-A: Uganda
Log (Cash remittances) 6.938 (4.588) 0.530 (2.355) −3.109 (2.093) −3.317 (3.466) 3.916 (2.970) 2.155 (1.729) 0.177 (0.699) 1.956 (1.604)
Log (Cash remittances) squared −0.986 (0.809) 0.045 (0.408) 0.577 (0.366) 0.735 (0.620)
Log (Cash remittances) × High remittance −2.933 (2.719) −1.214 (1.656) 0.205 (0.824) −1.627 (1.560)
Observations 1,603 1,603
Panel-B: Kenya
Log (Cash remittances) 0.867 (1.595) 1.584 (1.356) 0.904 (1.005) 3.852* (2.028) 0.996* (0.527) −0.057 (0.315) 0.507* (0.262) 0.311 (0.283)
Log (Cash remittances) squared −0.032 (0.281) −0.248 (0.240) −0.065 (0.177) −0.573 (0.358)
Log (Cash remittances) × High remittance −0.931 (0.584) 0.001 (0.416) 0.470 (0.466) −0.707* (0.426)
Observations 1,821 1,821
Panel-C: Nigeria
Log (Cash remittances) 6.736 (4.127) 0.171 (1.493) 6.679* (4.012) 4.603 (2.884) 0.787*** (0.203) −0.579*** (0.178) 0.517*** (0.181) −0.596*** (0.197)
Log (Cash remittances) squared −0.821 (0.540) −0.090 (0.197) −0.831 (0.525) −0.689* (0.383)
Log (Cash remittances) × High remittance −0.162 (1.672) −1.911 (2.561) 3.061 (3.495) −2.348 (2.895)
Observations 2,029 2,029
Panel-D: Burkina Faso
Log (Cash remittances) −1.690 (2.917) −3.570 (4.115) 2.952 (3.347) 3.977 (3.135) 0.588*** (0.212) 0.517*** (0.182) −0.248 (0.153) 0.573*** (0.215)
Log (Cash remittances) squared 0.463 (0.614) 0.863 (0.863) −0.682 (0.704) −0.751 (0.662)
Log (Cash remittances) × High remittance 2.096 (2.325) 0.060 (1.659) 0.565 (1.551) 0.300 (1.624)
Observations 1,895 1,895
Panel-E: Senegal
Log (Cash remittances) 2.999 (2.592) −1.285 (1.823) −5.129 (3.366) −7.571 (4.902) −0.753 (0.525) 0.428 (0.335) −0.293 (0.239) −0.112 (0.369)
Log (Cash remittances) squared −0.415 (0.348) 0.190 (0.244) 0.645 (0.448) 0.969 (0.655)
Log (Cash remittances) × High remittance 8.061 (6.029) −3.989 (3.602) 2.626 (2.747) 1.752 (4.266)
Observations 1,705 1,705

Effect of remittances on household investment decision conditional on having a migrant

Household with a migrant Household with no migrant
Human Capital Physical Capital (=1 if yes) Social Capital (=1 if yes) Human Capital Physical Capital (=1 if yes) Social Capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4) (5) (6) (7) (8)
Panel-A: Uganda
Received remittances (=1 if yes) 0.143*** (0.014) 0.113* (0.064) 0.044** (0.018) 0.096*** (0.017) 0.010 (0.011) −0.014*** (0.002) −0.010 (0.006) −0.005*** (0.001)
Mean of the outcome variable 0.736 0.798 0.131 0.327 0.641 0.786 0.108 0.276
Mean received remittances 0.356 0.054
Observations 719 884
Panel-B: Kenya
Received remittances (=1 if yes) 0.246*** (0.052) 0.269*** (0.025) 0.232*** (0.089) 0.311*** (0.013) −0.014*** (0.002) 0.008 (0.051) 0.013* (0.007) 0.013 (0.034)
Mean of the outcome variable 0.610 0.692 0.153 0.436 0.566 0.649 0.119 0.389
Mean received remittances 0.622 0.104
Observations 1,158 1,158
Panel-C: Nigeria
Received remittances (=1 if yes) 0.163** (0.067) −0.125*** (0.048) 0.242*** (0.050) −0.247*** (0.040) 0.047* (0.025) −0.010*** (0.003) 0.022*** (0.005) −0.036*** (0.005)
Mean of the outcome variable 0.773 0.756 0.191 0.347 0.659 0.777 0.177 0.418
Mean received remittances 0.579 0.151
Observations 1,253 776
Panel-D: Burkina Faso
Received remittances (=1 if yes) 0.206*** (0.048) 0.253*** (0.015) −0.216*** (0.056) 0.242*** (0.027) 0.053** (0.027) 0.056 (0.046) −0.062* (0.034) 0.057*** (0.011)
Mean of the outcome variable 0.696 0.878 0.231 0.654 0.568 0.871 0.229 0.641
Mean received remittances 0.542 0.193
Observations 1,142 753
Panel-E: Senegal
Received remittances (=1 if yes) −0.006 (0.145) 0.069 (0.147) 0.184 (0.123) 0.318*** (0.052) −0.012 (0.011) 0.032*** (0.012) 0.007 (0.006) −0.014 (0.009)
Mean of the outcome variable 0.727 0.838 0.109 0.738 0.581 0.803 0.073 0.728
Mean received remittances 0.745 0.072
Observations 1,065 640

Effect of remittances on household investment decision

Probit Recursive biprobit
Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4) (5) (6) (7) (8)
Panel-A: Uganda
Received remittances (=1 if yes) 0.198* (0.114) −0.058 (0.097) 0.137 (0.106) 0.157* (0.088) 0.478 (0.489) 0.047 (1.021) 0.730 (0.881) 0.572 (0.452)
Mean of the outcome variable 0.684 0.792 0.119 0.299 0.684 0.792 0.119 0.299
Observations 1,603 1,603
Panel-B: Kenya
Received remittances (=1 if yes) 0.067 (0.070) 0.043 (0.068) 0.259*** (0.080) 0.041 (0.065) 1.311*** (0.125) 1.414*** (0.102) 1.447*** (0.251) 1.332*** (0.095)
Mean of the outcome variable 0.594 0.676 0.141 0.418 0.594 0.676 0.141 0.418
Observations 1,821 1,821
Panel-C: Nigeria
Received remittances (=1 if yes) 0.174** (0.068) 0.070 (0.068) 0.186*** (0.070) 0.116* (0.062) 1.205*** (0.137) −0.632* (0.337) 1.416*** (0.183) −1.251*** (0.073)
Mean of the outcome variable 0.729 0.764 0.185 0.374 0.729 0.764 0.185 0.374
Observations 2,029 2,029
Panel-D: Burkina Faso
Received remittances (=1 if yes) 0.282*** (0.065) 0.080 (0.080) 0.000 (0.067) 0.032 (0.063) 1.149*** (0.221) 1.316*** (0.125) −1.178*** (0.207) 1.401*** (0.055)
Mean of the outcome variable 0.645 0.875 0.231 0.649 0.645 0.875 0.231 0.649
Observations 1,895 1,895
Panel-E: Senegal
Received remittances (=1 if yes) 0.262*** (0.071) −0.008 (0.081) 0.192** (0.094) −0.150** (0.071) 1.204*** (0.383) 0.270 (0.417) 0.198 (0.760) 1.202*** (0.140)
Mean of the outcome variable 0.672 0.825 0.096 0.734 0.672 0.825 0.096 0.734
Observations 1,705 1,705

Effect of cash remittances on household investment decision

Probit IV-probit
Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4) (5) (6) (7) (8)
Panel-A: Uganda
Log (Cash remittances) 0.008 (0.005) −0.003 (0.005) 0.004 (0.003) 0.009* (0.005) 0.137*** (0.015) 0.102** (0.046) 0.019 (0.049) 0.120*** (0.015)
Mean of the outcome variable 0.684 0.792 0.119 0.299 0.684 0.792 0.119 0.299
Observations 1,603 1,603
Panel-B: Kenya
Log (Cash remittances) 0.000 (0.003) 0.002 (0.004) 0.006** (0.002) −0.000 (0.004) 0.072*** (0.010) 0.079*** (0.011) 0.072*** (0.008) 0.085*** (0.002)
Mean of the outcome variable 0.594 0.676 0.141 0.418 0.594 0.676 0.141 0.418
Observations 1,821 1,821
Panel-C: Nigeria
Log (Cash remittances) 0.008** (0.003) 0.002 (0.003) 0.006** (0.003) 0.003 (0.004) 0.073*** (0.010) −0.044** (0.017) 0.066*** (0.009) −0.073*** (0.009)
Mean of the outcome variable 0.729 0.764 0.185 0.374 0.729 0.764 0.185 0.374
Observations 2,029 2,029
Panel-D: Burkina Faso
Log (Cash remittances) 0.020*** (0.005) 0.005 (0.004) −0.001 (0.004) −0.001 (0.005) 0.099*** (0.015) 0.113*** (0.011) −0.096*** (0.019) 0.119*** (0.003)
Mean of the outcome variable 0.645 0.875 0.231 0.649 0.645 0.875 0.231 0.649
Observations 1,895 1,895
Panel-E: Senegal
Log (Cash remittances) 0.012*** (0.003) 0.001 (0.003) 0.005** (0.002) −0.010*** (0.003) 0.022 (0.024) 0.024 (0.021) −0.021 (0.020) 0.021 (0.024)
Mean of the outcome variable 0.672 0.825 0.096 0.734 0.672 0.825 0.096 0.734
Observations 1,705 1,705

Correlation of treatment and outcome variables

Received remittances (=1 if yes) Log (cash remittances) Education (=1 if yes) Health (=1 if yes) Physical capital (=1 if yes) Social capital (=1 if yes) Log (education expenditure) Log (health expenditure) Log (physical capital expenditure) Log (social capital expenditure)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
Panel-A: Uganda
Received remittances (=1 if yes) 1
Log (cash remittances) 0.943 1
Education (=1 if yes) 0.120 0.108 1
Health (=1 if yes) 0.017 0.015 0.120 1
Physical capital (=1 if yes) 0.049 0.047 0.088 0.050 1
Social capital (=1 if yes) 0.074 0.068 0.113 0.167 0.153 1
Log (education expenditure) 0.161 0.171 0.865 0.141 0.082 0.129 1
Log (health expenditure) 0.112 0.122 0.175 0.797 0.085 0.188 0.282 1
Log (physical capital expenditure) 0.087 0.094 0.091 0.039 0.878 0.131 0.123 0.120 1
Log (social capital expenditure) 0.102 0.114 0.143 0.142 0.175 0.887 0.206 0.232 0.190 1
Panel-B: Kenya
Received remittances (=1 if yes) 1
Log (cash remittances) 0.937 1
Education (=1 if yes) 0.056 0.047 1
Health (=1 if yes) 0.08 0.078 0.225 1
Physical capital (=1 if yes) 0.099 0.09 0.106 0.054 1
Social capital (=1 if yes) 0.065 0.044 0.138 0.297 0.093 1
Log (education expenditure) 0.072 0.101 0.881 0.204 0.06 0.106 1
Log (health expenditure) 0.114 0.158 0.203 0.812 0.047 0.229 0.266 1
Log (physical capital expenditure) 0.098 0.114 0.095 0.048 0.918 0.07 0.078 0.064 1
Log (social capital expenditure) 0.076 0.085 0.147 0.273 0.08 0.865 0.158 0.304 0.082 1
Panel-C: Nigeria
Received remittances (=1 if yes) 1
Log (cash remittances) 0.941 1
Education (=1 if yes) 0.066 0.085 1
Health (=1 if yes) 0.031 0.019 0.126 1
Physical capital (=1 if yes) 0.076 0.068 −0.011 0.002 1
Social capital (=1 if yes) 0.056 0.031 0.076 0.266 0.021 1
Log (education expenditure) 0.129 0.183 0.875 0.081 0.006 0.035 1
Log (health expenditure) 0.102 0.118 0.122 0.845 0.031 0.272 0.157 1
Log (physical capital expenditure) 0.081 0.09 0.001 0.014 0.923 0.038 0.044 0.056 1
Log (social capital expenditure) 0.074 0.069 0.051 0.225 0.044 0.92 0.055 0.274 0.074 1
Panel-D: Burkina Faso
Received remittances (=1 if yes) 1
Log (cash remittances) 0.928 1
Education (=1 if yes) 0.117 0.123 1
Health (=1 if yes) 0.03 0.048 0.088 1
Physical capital (=1 if yes) 0.012 0.009 0.026 0.047 1
Social capital (=1 if yes) 0.021 0.015 0.098 0.128 0.137 1
Log (education expenditure) 0.126 0.154 0.861 0.105 0.053 0.085 1
Log (health expenditure) 0.038 0.091 0.116 0.76 0.059 0.135 0.202 1
Log (physical capital expenditure) 0.028 0.033 0.055 0.062 0.939 0.134 0.096 0.106 1
Log (social capital expenditure) −0.019 0.002 0.135 0.131 0.158 0.877 0.166 0.225 0.182 1
Panel-E: Senegal
Received remittances (=1 if yes) 1
Log (cash remittances) 0.961 1
Education (=1 if yes) 0.148 0.154 1
Health (=1 if yes) 0.058 0.075 0.096 1
Physical capital (=1 if yes) 0.047 0.045 −0.002 0.029 1
Social capital (=1 if yes) −0.003 −0.016 0.027 0.115 0.06 1
Log (education expenditure) 0.157 0.178 0.92 0.082 0.005 0.008 1
Log (health expenditure) 0.106 0.145 0.114 0.86 0.015 0.096 0.146 1
Log (physical capital expenditure) 0.056 0.058 0.004 0.028 0.971 0.056 0.018 0.023 1
Log (social capital expenditure) 0.031 0.038 0.074 0.156 0.033 0.916 0.087 0.196 0.035 1

Descriptive statistics by sources of remittances

Uganda Kenya Nigeria Burkina Faso Senegal
Internal African Out-of-Africa Internal African Out-of-Africa Internal African Out-of-Africa Internal African Out-of-Africa Internal African Out-of-Africa
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15)
Log (cash remittances) 4.621 (1.402) 5.534 (1.624) 6.686 (1.407) 5.097 (1.457) 6.232 (1.682) 7.013 (1.428) 5.458 (1.586) 6.262 (1.11) 7.069 (1.441) 3.844 (1.218) 4.427 (1.255) 5.51 (1.435) 6.13 (1.208) 6.293 (1.33) 7.295 (1.319)
Log (education expenditure) 4.187 (2.393) 4.525 (2.616) 4.469 (3.011) 3.003 (2.745) 3.078 (3.02) 3.511 (3.18) 4.153 (2.73) 4.128 (2.611) 5.152 (2.861) 2.545 (2.049) 2.587 (1.933) 3.738 (1.667) 3.202 (2.095) 3.221 (2.184) 3.793 (2.38)
Log (health expenditure) 3.116 (1.88) 3.405 (1.813) 3.361 (2.197) 2.465 (2.03) 2.845 (2.243) 3.442 (2.621) 3.433 (2.155) 3.128 (2.476) 3.795 (2.435) 3.479 (1.582) 3.329 (1.673) 4.057 (2.177) 3.851 (1.968) 3.825 (1.935) 4.328 (2.129)
Log (physical capital expenditure) 0.675 (1.856) 0.406 (1.27) 0.898 (2.188) 0.994 (2.1) 0.745 (2.077) 0.701 (1.904) 1.259 (2.409) 0.677 (1.958) 1.291 (2.61) 0.876 (1.677) 0.785 (1.547) 1.129 (2.027) 0.402 (1.369) 0.722 (1.804) 0.639 (1.82)
Log (social capital expenditure) 1.184 (1.768) 1.326 (1.943) 1.812 (2.239) 1.571 (1.952) 1.643 (2.252) 1.416 (2.227) 2.154 (2.516) 0.952 (2.238) 1.528 (2.534) 2.329 (1.991) 2.329 (2.045) 4.046 (2.051) 3.762 (2.401) 3.675 (2.395) 4.023 (2.664)
Observations 183 44 66 331 82 227 459 37 168 314 327 11 278 152 368

Alternative estimates of the effect of remittances on household investment decision

OLS 2SLS Imperfect IV
Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)
Panel-A: Uganda
Received remittances (=1 if yes) 0.051** −0.017 0.028 0.053* 1.673** 0.656 0.102 1.317** [0.051, 1.673] [0.051, 0.656] [0.035, 0.102] [0.180, 1.317]
(0.025) (0.026) (0.022) (0.031) (0.684) (0.468) (0.262) (0.619) (0.002, 3.014) (−0.043, 1.572) (−0.029, 0.616) (0.082, 2.530)
Observations 1,603 1,603 1,603
Panel-B: Kenya
Received remittances (=1 if yes) 0.029 0.016 0.056*** 0.015 0.694*** 0.649*** 0.471*** 1.192*** (0.722, 0.842) (0.853, 1.754) (0.499, 0.625) (1.436, 2.520)
(0.022) (0.022) (0.017) (0.024) (0.219) (0.232) (0.129) (0.270) (0.211, 1.792) (0.293, 3.281) (0.185, 1.246) (0.705, 4.498)
Observations 1,821 1,821 1,821
Panel-C: Nigeria
Received remittances (=1 if yes) 0.051** 0.020 0.049*** 0.042* 0.791*** −0.387** 0.708*** −0.872*** (0.051, 0.791) (−0.387, 0.020) (0.049, 0.708) (−0.872, 0.042)
(0.020) (0.020) (0.019) (0.023) (0.232) (0.195) (0.226) (0.277) (0.012, 1.246) (−0.786, 0.060) (0.013, 1.150) (−1.415, 0.087)
Observations 2,029
Panel-D: Burkina Faso
Received remittances (=1 if yes) 0.097*** 0.017 −0.001 0.012 0.530*** 0.501*** −0.415*** 1.145*** (0.361, 0.777) (0.256, 0.858) (−1.338, −1.078) (0.012, 0.675)
(0.022) (0.016) (0.020) (0.023) (0.160) (0.131) (0.144) (0.233) (0.049, 1.441) (−0.018, 1.470) (−2.485, −0.101) (−0.033, 1.352)
Observations 1,895 1,895 1,895
Panel-E: Senegal
Received remittances (=1 if yes) 0.087*** 0.004 0.028* −0.047** 0.161 0.203 −0.164 0.196 (0.087, 0.161) (0.018, 0.203) (−0.164, 0.028) (−0.047, 0.196)
(0.023) (0.020) (0.016) (0.023) (0.192) (0.172) (0.119) (0.206) (0.041, 0.538) (−0.040, 0.539) (−0.398, 0.058) (−0.091, 0.600)
Observations 1,705 1,705 1,705

First stage regression estimates

Uganda Kenya Nigeria Burkina Faso Senegal
(1) (2) (3) (4) (5)
Domestic migration network 0.004*** (0.001) −0.445*** (0.090) 0.646*** (0.130) 2.411*** (0.436) ––
International migration network –– 0.632* (0.356) –– 0.312*** (0.068) −0.535*** (0.113)
Household head is female (=1 if yes) 0.082*** (0.023) 0.230*** (0.025) 0.172*** (0.034) 0.151*** (0.047) 0.288*** (0.026)
Head paid employee (=1 if yes) −0.078** (0.040) −0.143*** (0.032) −0.200*** (0.039) −0.227*** (0.082) −0.118***
(0.041)
Head self-employed (=1 if yes) −0.096*** (0.034) −0.085*** (0.029) −0.137*** (0.034) −0.078 (0.055) −0.078*** (0.030)
Head has secondary education (=1 if yes) 0.061** (0.024) 0.014 (0.027) 0.039 (0.031) 0.058 (0.064) 0.046 (0.035)
Head has above secondary education (=1 if yes) 0.076** (0.030) 0.040 (0.032) 0.018 (0.030) 0.177 (0.131) −0.022 (0.048)
Head's age 45–60 (=1 if yes) 0.111*** (0.026) 0.022 (0.026) 0.123*** (0.024) 0.114*** (0.025) −0.065** (0.026)
Head's age is >60 (=1 if yes) 0.073 (0.060) 0.125*** (0.045) 0.212*** (0.044) 0.212*** (0.037) −0.017 (0.038)
Log household income (in USD) 0.057*** (0.010) 0.071*** (0.011) 0.085*** (0.013) 0.024* (0.014) 0.099*** (0.017)
Number of children in household 0.010* (0.005) −0.001 (0.007) −0.004 (0.003) 0.015* (0.008) 0.017*** (0.004)
Number of elderly in household 0.080* (0.041) 0.036 (0.026) 0.026 (0.024) 0.039** (0.018) 0.060*** (0.022)
Household is in urban area (=1 if yes) −0.002 (0.024) −0.070*** (0.025) −0.066*** (0.023) −0.075 (0.052) −0.077*** (0.027)
Constant −0.285*** (0.072) −0.109 (0.082) −0.324*** (0.108) −0.201 (0.137) −0.364** (0.135)
Observations 1,603 1,821 2,029 1,895 1,705
F-statistics (test of excluded instrument) 7.24 16.11 24.68 20.58 22.45
SW Chi-squared statistics (underidentification test) 7.3 32.47 24.84 41.47 22.62
SW F-statistics (weak identification test) 7.24 16.11 24.67 20.58 22.45
Cragg-Donald Wald F-statistic (weak identification test) 7.78 14.68 24.44 20.06 23.19
Hansen's J-statistic (overidentification test of instruments) – 0.382 – 2.87 –

Effect of remittances amount on household investment expenditure

OLS 2SLS
Human capital Log (Physical capital expenditure) Log (Social capital expenditure) Human capital Log (Physical capital expenditure) Log (Social capital expenditure)
Log (Education expenditure) Log (Health expenditure) Log (Education expenditure) Log (Health expenditure)
(1) (2) (3) (4) (5) (6) (7) (8)
Panel-A: Uganda
Log (Cash remittances) 0.053* (0.029) 0.028 (0.023) 0.035 (0.022) 0.041* (0.024) 1.469** (0.638) 0.779* (0.401) 0.093 (0.242) 0.759* (0.388)
Mean of the outcome variable 3.408 2.791 0.466 0.981 3.408 2.791 0.466 0.981
Observations 1,603 1,603
Panel-B: Kenya
Log (Cash remittances) 0.023 (0.022) 0.025 (0.018) 0.044*** (0.015) 0.002 (0.017) 0.686*** (0.253) 0.188 (0.183) 0.540*** (0.153) 0.624*** (0.204)
Mean of the outcome variable 3.115 2.742 0.680 1.556 3.115 2.742 0.680 1.556
Observations 1,821 1,821
Panel-C: Nigeria
Log (Cash remittances) 0.070*** (0.019) 0.032* (0.017) 0.042** (0.017) 0.025 (0.019) 0.633*** (0.162) −0.498*** (0.144) 0.504*** (0.151) −0.522*** (0.162)
Mean of the outcome variable 3.989 3.312 0.976 1.763 3.989 3.312 0.976 1.763
Observations 2,029 2,029
Panel-D: Burkina Faso
Log (Cash remittances) 0.087*** (0.020) 0.033** (0.016) 0.007 (0.018) −0.037* (0.021) 0.500*** (0.159) 0.508*** (0.147) −0.275** (0.127) 0.428** (0.169)
Mean of the outcome variable 2.361 3.376 0.820 2.454 2.361 3.376 0.820 2.454
Observations 1,895 1,895
Panel-E: Senegal
Log (Cash remittances) 0.071*** (0.017) 0.023 (0.015) 0.025** (0.012) −0.039** (0.019) −0.232 (0.149) 0.192 (0.122) −0.111 (0.082) −0.037 (0.150)
Mean of the outcome variable 3.112 3.867 0.484 3.790 3.112 3.867 0.484 3.790
Observations 1,705 1,705

Effect of remittances on household investment decision by remittance source

Internal remittances Within-Africa remittances Out-of-Africa remittances
Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes) Human capital Physical capital (=1 if yes) Social capital (=1 if yes)
Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes) Education (=1 if yes) Health (=1 if yes)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12)
Panel-A: Uganda
Received remittances (=1 if yes) 0.011 (0.011) −0.013* (0.008) −0.025 (0.044) 0.009 (0.018) 0.006 (0.007) 0.009 (0.020) 0.002 (0.001) −0.002*** (0.000) −0.006*** (0.002) −0.002 (0.009) 0.004*** (0.001) 0.010*** (0.002)
Mean of the outcome variable 0.677 0.790 0.115 0.291 0.661 0.791 0.111 0.285 0.661 0.788 0.114 0.290
Observations 1,482 1,343 1,365
Panel-B: Kenya
Received remittances (=1 if yes) 0.083*** (0.009) 0.095*** (0.014) 0.061** (0.030) 0.073*** (0.007) 0.021*** (0.006) 0.028*** (0.009) 0.005*** (0.002) 0.016*** (0.003) 0.038 (0.038) 0.066 (0.048) 0.021*** (0.006) 0.009 (0.082)
Mean of the outcome variable 0.581 0.654 0.137 0.409 0.572 0.648 0.112 0.393 0.573 0.657 0.114 0.381
Observations 1,363 1,114 1,259
Panel-C: Nigeria
Received remittances (=1 if yes) 0.127*** (0.006) 0.073 (0.317) 0.071*** (0.014) −0.084*** (0.006) −0.003** (0.001) 0.002*** (0.000) 0.001 (0.001) 0.002 (0.002) 0.037** (0.018) 0.015 (0.025) 0.004 (0.021) 0.013 (0.022)
Mean of the outcome variable 0.722 0.759 0.184 0.385 0.706 0.750 0.159 0.346 0.715 0.753 0.167 0.343
Observations 1,646 1,224 1,355
Panel-D: Burkina Faso
Received remittances (=1 if yes) 0.082*** (0.018) 0.122*** (0.009) −0.095*** (0.013) 0.053*** (0.002) 0.081*** (0.022) 0.114*** (0.009) −0.041*** (0.005) 0.051*** (0.004) 0.002 (0.005) 0.002*** (0.001) 0.000** (0.000) 0.002 (0.019)
Mean of the outcome variable 0.619 0.875 0.228 0.642 0.624 0.867 0.226 0.640 0.602 0.867 0.227 0.643
Observations 1,445 1,458 1,142
Panel-E: Senegal
Received remittances (=1 if yes) 0.052** (0.025) −0.006 (0.022) −0.033 (0.049) 0.003 (0.037) 0.014 (0.022) −0.001 (0.018) −0.039* (0.024) 0.027 (0.035) −0.017 (0.037) 0.067 (0.056) 0.003 (0.073) 0.121*** (0.006)
Mean of the outcome variable 0.636 0.813 0.083 0.740 0.622 0.810 0.091 0.736 0.648 0.815 0.092 0.732
Observations 1,144 1,018 1,234

Mechanisms of the effect

Income effect Labor substitution Migration expectation
Above median consumption expenditure (=1 if yes) Own radio (=1 if yes) Own mobile phone (=1 if yes) Proportion of adult household member working Proportion of children aged 6–15 working Proportion of children aged 6–15 in school
(1) (2) (3) (4) (5) (6)
Panel-A: Uganda
Received remittances (=1 if yes) 0.045*** (0.003) −0.013 (0.021) 0.006 (0.020) −0.234 (0.266) −0.094 (0.237) 0.305 (0.464)
Mean of the outcome variable 0.303 0.778 0.569 0.676 0.080 0.871
Observations 1,603 1,603 1,603 1,603 963 963
Panel-B: Kenya
Received remittances (=1 if yes) 0.154*** (0.011) 0.136*** (0.051) 0.001 (0.069) −0.298*** (0.105) 0.058 (0.039) 0.308 (0.930)
Mean of the outcome variable 0.253 0.848 0.801 0.541 0.004 0.832
Observations 1,821 1,821 1,821 1,821 901 901
Panel-C: Nigeria
Received remittances (=1 if yes) 0.070*** (0.024) 0.196*** (0.016) 0.171*** (0.011) 0.665*** (0.172) −0.073 (0.057) 0.984*** (0.274)
Mean of the outcome variable 0.339 0.876 0.5783 0.595 0.031 0.705
Observations 2,030 2,030 2,030 2,030 1,245 1,245
Panel-D: Burkina Faso
Received remittances (=1 if yes) −0.132** (0.062) 0.149*** (0.044) 0.104*** (0.030) 0.278*** (0.094) −1.001*** (0.221) 0.802*** (0.205)
Mean of the outcome variable 0.322 0.062 0.403 0.764 0.412 0.452
Observations 1,895 1,895 1,895 1,895 1,633 1,633
Panel-E: Senegal
Received remittances (=1 if yes) 0.179*** (0.009) 0.110** (0.045) 0.117* (0.064) −0.205* (0.117) 0.342 (0.247) −0.606* (0.353)
Mean of the outcome variable 0.678 0.823 0.850 0.541 0.294 0.684
Observations 1,705 1,705 1,705 1,705 1,296 1,296

Summary statistics

Uganda Kenya Nigeria Burkina Faso Senegal
Received Remittances (= if yes) Not Received Remittances (= if yes) Received Remittances (= if yes) Not Received Remittances (= if yes) Received Remittances (= if yes) Not Received Remittances (= if yes) Received Remittances (= if yes) Not Received Remittances (= if yes) Received Remittances (= if yes) Not Received Remittances (= if yes)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
Female household head (=1 if yes) 0.375 (0.485) 0.282 (0.45) 0.425 (0.495) 0.221 (0.415) 0.167 (0.374) 0.074 (0.262) 0.089 (0.285) 0.051 (0.221) 0.431 (0.496) 0.186 (0.389)
Head is paid employee (=1 if yes) 0.243 (0.43) 0.254 (0.435) 0.238 (0.426) 0.408 (0.492) 0.214 (0.41) 0.297 (0.457) 0.021 (0.143) 0.033 (0.178) 0.107 (0.31) 0.217 (0.413)
Head is self-employed (=1 if yes) 0.546 (0.499) 0.631 (0.483) 0.381 (0.486) 0.383 (0.486) 0.576 (0.494) 0.626 (0.484) 0.904 (0.294) 0.935 (0.247) 0.485 (0.5) 0.533 (0.499)
Head has secondary education (=1 if yes) 0.336 (0.473) 0.326 (0.469) 0.262 (0.44) 0.296 (0.457) 0.236 (0.425) 0.214 (0.41) 0.034 (0.181) 0.036 (0.187) 0.142 (0.349) 0.15 (0.357)
Head has above secondary education (=1 if yes) 0.418 (0.494) 0.373 (0.484) 0.251 (0.434) 0.261 (0.439) 0.521 (0.5) 0.545 (0.498) 0.012 (0.108) 0.006 (0.078) 0.055 (0.228) 0.11 (0.313)
Head's age 45–60 years (=1 if yes) 0.352 (0.478) 0.224 (0.417) 0.284 (0.451) 0.301 (0.459) 0.433 (0.496) 0.365 (0.482) 0.336 (0.473) 0.306 (0.461) 0.308 (0.462) 0.386 (0.487)
Head's age >60 years (=1 if yes) 0.204 (0.404) 0.112 (0.315) 0.316 (0.465) 0.149 (0.356) 0.284 (0.451) 0.114 (0.318) 0.318 (0.466) 0.157 (0.364) 0.336 (0.473) 0.255 (0.436)
Log household income 7.6 (1.091) 7.181 (1.09) 7.974 (1.102) 7.755 (1.253) 8.574 (0.902) 8.321 (0.876) 7.661 (0.787) 7.591 (0.852) 8.829 (0.731) 8.612 (0.813)
Number of children in the household 2.299 (1.998) 2.045 (1.929) 1.432 (1.54) 1.47 (1.614) 6.057 (3.183) 6.039 (3.436) 1.529 (1.545) 1.492 (1.417) 4.277 (3.631) 3.18 (2.934)
Number of elderly in household 0.332 (0.584) 0.175 (0.433) 0.583 (0.747) 0.344 (0.637) 0.504 (0.722) 0.253 (0.562) 0.67 (0.847) 0.416 (0.675) 0.703 (0.753) 0.515 (0.709)
Household is in urban area (=1 if yes) 0.51 (0.501) 0.487 (0.5) 0.423 (0.494) 0.54 (0.499) 0.456 (0.498) 0.513 (0.5) 0.067 (0.25) 0.058 (0.235) 0.631 (0.483) 0.692 (0.462)
Remittances amount (in USD) 776.47 (2,391.68) 0 (0) 2,170.59 (10,769.82) 0 (0) 1,847.85 (6,819.30) 0 (0) 181.86 (427.82) 0 (0) 1,890.90 (2,752.23) 0 (0)
Domestic migration network (%) −1.915 (7.992) −2.849 (8.077) 0.106 (0.169) 0.152 (0.218) 0.129 (0.082) 0.108 (0.081) 0.109 (0.031) 0.103 (0.023) 3.486 (2.122) 3.67 (2.014)
International migration network (%) –– –– 0.037 (0.045) 0.045 (0.052) –– –– 0.356 (0.17) 0.329 (0.163) 0.101 (0.116) 0.128 (0.122)
Education investment (in USD) 481.154 (769.14) 269.02 (585.13) 464.76 (965.26) 375.07 (911.61) 607.35 (944.09) 360.37 (709.12) 71.07 (134.21) 50.86 (109.27) 143.80 (209.14) 106.97 (190.90)
Health investment (in USD) 89.89 (131.07) 48.15 (83.14) 181.44 (420.75) 128.95 (363.64) 157.03 (236.93) 100.82 (177.72) 81.46 (116.24) 74.74 (111.63) 203.65 (299.5) 145.53 (244.77)
Physical capital investment (in USD) 91.94 (437.17) 28.83 (232.32) 142.41 (745.31) 56.58 (384.57) 211.58 (821.46) 123.18 (591.59) 19.33 (70.58) 14.077 (51.69) 34.77 (134.67) 18.77 (92.35)
Social capital investment (in USD) 30.01 (72.08) 17.19 (53.70) 100.34 (411.34) 67.70 (327.98) 186.17 (603.84) 112.51 (432.07) 52.20 (92.62) 57.22 (95.56) 269.08 (412.80) 217.64 (346.22)
Number of observations 304 1,299 789 1,032 842 1,188 764 1,131 839 866
eISSN:
2520-1786
Langue:
Anglais
Périodicité:
Volume Open
Sujets de la revue:
Business and Economics, Political Economics, Microeconomics, Macroecomics, Economic Policy, Mathematics and Statistics for Economists, Econometrics
RSS Feed de la revue