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International Remittances and Private Interhousehold Transfers: Exploring the Links

Author

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  • Yonas Alem

    (University of Gothenburg)

  • Lisa Andersson

    (Maastricht Graduate School of Governance/UNU-Merit)

Abstract

We investigate the effect of international remittances from migrated family members on informal interhousehold transfers—an issue that has received limited attention in the literature. Using rich panel data from urban Ethiopia spanning 15 years, we show that receiving international remittances increases the value of private domestic interhousehold transfers, whereas receiving domestic remittances does not have any effect. We also show that the transfers sent respond to shocks to a great extent. Our results provide new evidence on the trickle-down effects of international remittances, effects important to consider when analyzing the impact of international remittances on household outcomes in recipient countries.

Suggested Citation

  • Yonas Alem & Lisa Andersson, 2019. "International Remittances and Private Interhousehold Transfers: Exploring the Links," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(4), pages 902-928, September.
    • Handle: RePEc:pal:eurjdr:v:31:y:2019:i:4:d:10.1057_s41287-019-0193-4
    DOI: 10.1057/s41287-019-0193-4
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    More about this item

    Keywords

    International remittances; Interhousehold transfers; Urban Ethiopia; Panel data; Shocks;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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