IDEAS home Printed from https://ideas.repec.org/a/kqi/journl/2020-4-1-11.html
   My bibliography  Save this article

Are Households Utilizing Remittance on Quality Education? An Empirical Study from Nepal

Author

Listed:
  • Dhruba Bhandari

    (Institute for Integrated Development Studies (IIDS), Nepal)

Abstract

Are households in Nepal investing remittance income to improve quality of education of their children? This paper investigates the question using data from the third round of Nepal Living Standard Survey (NLSS). Quality education in this paper is measured as private school enrollment, hiring of private tutor, expenditure in private tutoring, and expenditure in school tuition. Measuring causal effect of remittance on these variables is challenging because of two separate self-selection issues namely: self-selection of household into migration and decision of migrants to remit. These challenges are addressed by restricting analysis to households with migrants and using instrumental variable (IV) regression. Controlling for hosts of observable household level characteristic, child level characteristic and using region fixed effect there is no evidence of causal effect of remittance on private school enrollment and hiring of private tutor. However, there is positive minimal impact of remittance on remittance on expenditure in private tuition and on expenditure in school tuition.

Suggested Citation

  • Dhruba Bhandari, 2020. "Are Households Utilizing Remittance on Quality Education? An Empirical Study from Nepal," Journal of Development Innovations, KarmaQuest International, vol. 4(1), pages 179-195, July.
    • Handle: RePEc:kqi:journl:2020-4-1-11
    as

    Download full text from publisher

    File URL: https://karmaquest.org/journal/index.php/ILGDI/article/view/58/43
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," NBER Chapters, in: Investment in Human Beings, pages 9-49, National Bureau of Economic Research, Inc.
    2. Michael Lokshin & Elena Glinskaya, 2009. "The Effect of Male Migration on Employment Patterns of Women in Nepal," The World Bank Economic Review, World Bank, vol. 23(3), pages 481-507, November.
    3. Chakra P ACHARYA & Roberto LEON-GONZALEZ, 2013. "The Impact of Remittance on Poverty and Inequality: A Micro-Simulation Study for Nepal," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 3(9), pages 1061-1080.
    4. Amrit Thapa, 2015. "Public and private school performance in Nepal: an analysis using the SLC examination," Education Economics, Taylor & Francis Journals, vol. 23(1), pages 47-62, February.
    5. Ça?lar Özden & Maurice Schiff, 2007. "International Migration, Economic Development and Policy," World Bank Publications - Books, The World Bank Group, number 6766.
    6. Angrist, Joshua D, 2001. "Estimations of Limited Dependent Variable Models with Dummy Endogenous Regressors: Simple Strategies for Empirical Practice," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(1), pages 2-16, January.
    7. Pablo Acosta, 2011. "School Attendance, Child Labour, and Remittances from International Migration in El Salvador," Journal of Development Studies, Taylor & Francis Journals, vol. 47(6), pages 913-936.
    8. Sridhar Thapa & Sanjaya Acharya, 2017. "Remittances and Household Expenditure in Nepal: Evidence from Cross-Section Data," Economies, MDPI, vol. 5(2), pages 1-17, May.
    9. Apsara Karki Nepal, 2016. "The Impact of International Remittances on Child Outcomes and Household Expenditures in Nepal," Journal of Development Studies, Taylor & Francis Journals, vol. 52(6), pages 838-853, June.
    10. Cynthia Bansak & Brian Chezum & Animesh Giri, 2015. "Remittances, school quality, and household education expenditures in Nepal," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-19, December.
    11. Taylor, J. Edward & Mora, Jorge, 2006. "Does migration reshape expenditures in rural households? Evidence from Mexico," Policy Research Working Paper Series 3842, The World Bank.
    12. Acosta, Pablo & Calderon, Cesar & Fajnzylber, Pablo & Lopez, Humberto, 2008. "What is the Impact of International Remittances on Poverty and Inequality in Latin America?," World Development, Elsevier, vol. 36(1), pages 89-114, January.
    13. Shankar Ghimire & Kul Prasad Kapri, 2020. "Does the Source of Remittance Matter? Differentiated Effects of Earned and Unearned Remittances on Agricultural Productivity," Economies, MDPI, vol. 8(1), pages 1-15, January.
    14. Phadera, Lokendra, 2016. "International Migration and its Effect on Labor Supply of the Left-Behind Household Members: Evidence from Nepal," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235968, Agricultural and Applied Economics Association.
    15. Ratha, Dilip & Mohapatra, Sanket & Scheja, Elina, 2011. "Impact of migration on economic and social development : a review of evidence and emerging issues," Policy Research Working Paper Series 5558, The World Bank.
    16. Wagle, Udaya R. & Devkota, Satis, 2018. "The impact of foreign remittances on poverty in Nepal: A panel study of household survey data, 1996–2011," World Development, Elsevier, vol. 110(C), pages 38-50.
    17. Richard Adams, 2011. "Evaluating the Economic Impact of International Remittances On Developing Countries Using Household Surveys: A Literature Review," Journal of Development Studies, Taylor & Francis Journals, vol. 47(6), pages 809-828.
    18. Nguyen, Trang & Purnamasari, Ririn, 2011. "Impacts of international migration and remittances on child outcomes and labor supply in Indonesia : how does gender matter ?," Policy Research Working Paper Series 5591, The World Bank.
    19. Alejandra Cox Edwards & Manuelita Ureta, 2003. "International Migration, Remittances, and Schooling: Evidence from El Salvador," NBER Working Papers 9766, National Bureau of Economic Research, Inc.
    20. Chandan Sapkota, 2013. "Remittances in Nepal: Boon or Bane?," Journal of Development Studies, Taylor & Francis Journals, vol. 49(10), pages 1316-1331, October.
    21. Acosta, Pablo, 2006. "Labor supply, school attendance, and remittances from international migration : the case of El Salvador," Policy Research Working Paper Series 3903, The World Bank.
    22. Edwards, Alejandra Cox & Ureta, Manuelita, 2003. "International migration, remittances, and schooling: evidence from El Salvador," Journal of Development Economics, Elsevier, vol. 72(2), pages 429-461, December.
    23. Angrist, Joshua D, 2001. "Estimations of Limited Dependent Variable Models with Dummy Endogenous Regressors: Simple Strategies for Empirical Practice: Reply," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(1), pages 27-28, January.
    24. Robert J. Barro, 2001. "Human Capital and Growth," American Economic Review, American Economic Association, vol. 91(2), pages 12-17, May.
    25. Kapri, Kul & Ghimire, Shankar, 2020. "Migration, remittance, and agricultural productivity: Evidence from the Nepal Living Standard Survey," World Development Perspectives, Elsevier, vol. 19(C).
    26. Cynthia Bansak & Brian Chezum, 2009. "How Do Remittances Affect Human Capital Formation of School-Age Boys and Girls?," American Economic Review, American Economic Association, vol. 99(2), pages 145-148, May.
    27. Amuedo-Dorantes, Catalina & Pozo, Susan, 2010. "Accounting for Remittance and Migration Effects on Children's Schooling," World Development, Elsevier, vol. 38(12), pages 1747-1759, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nguyen, Cuong Viet & Nguyen, Hoa Quynh, 2015. "Do internal and international remittances matter to health, education and labor of children and adolescents? The case of Vietnam," Children and Youth Services Review, Elsevier, vol. 58(C), pages 28-34.
    2. Mishra, Khushbu & Kondratjeva, Olga & Shively, Gerald E., 2022. "Do remittances reshape household expenditures? Evidence from Nepal," World Development, Elsevier, vol. 157(C).
    3. Koska, Onur A. & Saygin, Perihan Özge & Çağatay, Selim & Artal-Tur, Andrés, 2013. "International migration, remittances, and the human capital formation of Egyptian children," International Review of Economics & Finance, Elsevier, vol. 28(C), pages 38-50.
    4. Sèna Kimm Gnangnon, 2020. "Development aid, remittances inflows and wages in the manufacturing sector," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 22(2), pages 278-304, December.
    5. Leonardo Bonilla-Mejía, 2017. "Choques externos y remesas internacionales en las regiones de Colombia," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 35(84), pages 189-202, December.
    6. Nguyen, Cuong & Nguyen, Hoa, 2013. "Do Internal and International Remittances Matter to Health, Education and Labor of Children? The Case of Vietnam," MPRA Paper 48672, University Library of Munich, Germany.
    7. Joseph B. Ajefu & Joseph O. Ogebe, 2021. "The effects of international remittances on expenditure patterns of the left‐behind households in Sub‐Saharan Africa," Review of Development Economics, Wiley Blackwell, vol. 25(1), pages 405-429, February.
    8. Gnangnon, Sèna Kimm, 2020. "Development Aid, Remittances Inflows and Wages in the Manufacturing Sector of Recipient-Countries," EconStor Preprints 213439, ZBW - Leibniz Information Centre for Economics.
    9. Sharma, Hari, 2020. "The effect of emigration and remittances on labour supply of the left-behind: Evidence from Nepal," MPRA Paper 102091, University Library of Munich, Germany.
    10. Azizi, SeyedSoroosh, 2018. "The impacts of workers' remittances on human capital and labor supply in developing countries," Economic Modelling, Elsevier, vol. 75(C), pages 377-396.
    11. Feng Hu, 2013. "Does migration benefit the schooling of children left behind?," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 29(2), pages 33-70.
    12. Randazzo, Teresa & Pavanello, Filippo & De Cian, Enrica, 2023. "Adaptation to climate change: Air-conditioning and the role of remittances," Journal of Environmental Economics and Management, Elsevier, vol. 120(C).
    13. Nida Jamil, 2017. "The Impact of Remittances Versus Parental Absence on Children’s Wellbeing: Evidence from Rural Punjab," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 22(2), pages 1-37, July-Dec.
    14. Md Shahadath Hossain & Adesola Sunmoni, "undated". "Do Remittances Influence Household Investment Decisions? Evidence from Sub-Saharan Africa," Economics Discussion Papers em-dp2021-04, Department of Economics, University of Reading.
    15. Hari Sharma & John Gibson, 2020. "Effects of International Migration on Child Schooling and Child Labour: Evidence from Nepal," Working Papers in Economics 20/07, University of Waikato.
    16. Zhang, Yi & Matz, Julia Anna, 2017. "On the train to brain gain in rural China," Discussion Papers 252443, University of Bonn, Center for Development Research (ZEF).
    17. Cynthia Bansak & Brian Chezum & Animesh Giri, 2015. "Remittances, school quality, and household education expenditures in Nepal," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-19, December.
    18. Mora-Rivera, Jorge & van Gameren, Edwin, 2021. "The impact of remittances on food insecurity: Evidence from Mexico," World Development, Elsevier, vol. 140(C).
    19. Khraiche, Maroula & Boudreau, James, 2020. "Can lower remittance costs improve human capital accumulation in Africa?," Journal of Policy Modeling, Elsevier, vol. 42(5), pages 1000-1021.
    20. Bargain, Olivier B. & Boutin, Delphine, 2014. "Remittances and Child Labour in Africa: Evidence from Burkina Faso," IZA Discussion Papers 8007, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    International Migration; Remittance; Human Capital Investment; Nepal;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kqi:journl:2020-4-1-11. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bamadev Paudel (email available below). General contact details of provider: https://edirc.repec.org/data/sneeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.