IDEAS home Printed from https://ideas.repec.org/p/wii/bpaper/077.html
   My bibliography  Save this paper

Labour Supply, Remittances and the New Flat Tax in Albania

Author

Listed:
  • Edlira Narazani

Abstract

In this paper we use Living Standard Measurement Survey (2005) to analyze the effects of remittances on the labor participation decisions of the Albanian non-migrants. We apply a micro-econometric two-sector labour supply model where the individuals remaining in Albania are allowed to choose among several labour market alternatives (non-employment, part time, full time and extra-time) together with the choice of being selfemployed or wage workers. The estimated coefficients of the utility function indicate a positive effect in average of the remittances’ receipt on the preferences for leisure for both males and females. However, using the estimated coefficients of the utility function to simulate the effect of a percentage increase in remittances on hours worked, we find that non-migrant substitute income for leisure only in case they are wage workers while a labour incentive effect is observed for the self-employed. The flat tax would make labour behaviour of individuals in Albania more neutral versus remittances due to their shift in budget constraint especially in case of self employed.

Suggested Citation

  • Edlira Narazani, 2009. "Labour Supply, Remittances and the New Flat Tax in Albania," wiiw Balkan Observatory Working Papers 77, The Vienna Institute for International Economic Studies, wiiw.
    • Handle: RePEc:wii:bpaper:077
    as

    Download full text from publisher

    File URL: https://wiiw.ac.at/labour-supply-remittances-and-the-new-flat-tax-in-albania-dlp-3220.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Migration, Remittances, and Male and Female Employment Patterns," American Economic Review, American Economic Association, vol. 96(2), pages 222-226, May.
    2. Aaberge, Rolf & Colombino, Ugo & Strom, Steinar, 1999. "Labour Supply in Italy: An Empirical Analysis of Joint Household Decisions, with Taxes and Quantity Constraints," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(4), pages 403-422, July-Aug..
    3. Anand, Sudhir & Kanbur, S. M. R., 1993. "Inequality and development A critique," Journal of Development Economics, Elsevier, vol. 41(1), pages 19-43, June.
    4. Zezza, Alberto & Carletto, Calogero & Davis, Benjamin, 2005. "Moving away from poverty: A spatial analysis of poverty and migration in Albania," ESA Working Papers 289076, Food and Agriculture Organization of the United Nations, Agricultural Development Economics Division (ESA).
    5. Yves Bourdet & Hans Falck, 2006. "Emigrants' remittances and Dutch Disease in Cape Verde," International Economic Journal, Taylor & Francis Journals, vol. 20(3), pages 267-284.
    6. Funkhouser, Edward, 1992. "Migration from Nicaragua: some recent evidence," World Development, Elsevier, vol. 20(8), pages 1209-1218, August.
    7. repec:bla:scandj:v:97:y:1995:i:4:p:635-59 is not listed on IDEAS
    8. Adams, Richard H. Jr., 2004. "Remittances and poverty in Guatemala," Policy Research Working Paper Series 3418, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ebele Stella Nwokoye & Clement Izuchukwu Igbanugo & Stephen Kelechi Dimnwobi, 2020. "International migrant remittances and labour force participation in Nigeria," African Development Review, African Development Bank, vol. 32(2), pages 125-137, June.
    2. Vladimir Gligorov, 2009. "Mobility and Transition in Integrating Europe," Human Development Research Papers (2009 to present) HDRP-2009-15, Human Development Report Office (HDRO), United Nations Development Programme (UNDP), revised Apr 2009.

    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. Wim Naudé & Melissa Siegel & Katrin Marchand, 2017. "Migration, entrepreneurship and development: critical questions," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 6(1), pages 1-16, December.
    2. Sena Kimm Gnangnon, 2019. "Remittances Inflows and Trade Policy," Remittances Review, Remittances Review, vol. 4(2), pages 117-142, October.
    3. Mendola, Mariapia & Carletto, Calogero, 2012. "Migration and gender differences in the home labour market: Evidence from Albania," Labour Economics, Elsevier, vol. 19(6), pages 870-880.
    4. Naudé, Wim & Siegel, Melissa & Marchand, Katrin, 2015. "Migration, entrepreneurship and development: A critical review," MERIT Working Papers 2015-033, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    5. Kalaj, Ermira Hoxha, 2010. "Remittances and Human Capital Investment: Evidence from Albania," MPRA Paper 49210, University Library of Munich, Germany.
    6. Patricia Justino & Olga Shemyakina, 2012. "Remittances and labor supply in post-conflict Tajikistan," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-28, December.
    7. Laetitia Duval & Francois-Charles Wolff, 2010. "Remittances matter: longitudinal evidence from Albania," Post-Communist Economies, Taylor & Francis Journals, vol. 22(1), pages 73-97.
    8. Jean-Louis Combes & Christian Hubert Ebeke & Mathilde Maurel & Urbain Thierry Yogo, 2011. "Remittances and the prevalence of working poor," Post-Print halshs-00587797, HAL.
    9. Khaled Chnaina & Farid Makhlouf, 2015. "Impact des Transferts de Fonds sur le Taux de Change Réel Effectif en Tunisie," African Development Review, African Development Bank, vol. 27(2), pages 145-160, June.
    10. Calero, Carla & Bedi, Arjun S. & Sparrow, Robert, 2009. "Remittances, Liquidity Constraints and Human Capital Investments in Ecuador," World Development, Elsevier, vol. 37(6), pages 1143-1154, June.
    11. Catalina Amuedo-Dorantes & Susan Pozo, 2012. "Remittance Income Volatility and Labor Supply in Mexico," Southern Economic Journal, John Wiley & Sons, vol. 79(2), pages 257-276, October.
    12. Farid Makhlouf & Mazhar Mughal, 2013. "Remittances, Dutch Disease, And Competitiveness: A Bayesian Analysis," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 38(2), pages 67-97, June.
    13. Kamalbek Karymshakov & Burulcha Sulaimanova, 2017. "Migration impact on left-behind women’s labour participation and time-use: Evidence from Kyrgyzstan," WIDER Working Paper Series 119, World Institute for Development Economic Research (UNU-WIDER).
    14. Göbel, Kristin, 2012. "Remittances and Gender-Speci fic Employment Patterns in Peru - a longitudinal Analysis," VfS Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 65409, Verein für Socialpolitik / German Economic Association.
    15. George Berulava, 2019. "Migration and labor supply in Georgia: an empirical study," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 9(3), pages 395-419, September.
    16. Anda DAVID & Audrey LENOEL, 2017. "International emigration and labour market outcomes of women staying behind: the case of Morocco," Working Paper f7f57256-7aaf-4dc5-9840-b, Agence française de développement.
    17. Naiditch, Claire & Vranceanu, Radu, 2009. "Migrant wages, remittances and recipient labour supply in a moral hazard model," Economic Systems, Elsevier, vol. 33(1), pages 60-82, March.
    18. Mariapia Mendola & Gero Carletto, 2008. "International migration and gender differentials in the home labor market: evidence from Albania," Working Papers 148, University of Milano-Bicocca, Department of Economics, revised Dec 2008.
    19. Catalina Amuedo-Dorantes & Susan Pozo, 2012. "Remittance Income Volatility and Labor Supply in Mexico," Southern Economic Journal, Southern Economic Association, vol. 79(2), pages 257-276, October.
    20. Cynthia Kinnan & Shing-Yi Wang & Yongxiang Wang, 2015. "Relaxing Migration Constraints for Rural Households," NBER Working Papers 21314, National Bureau of Economic Research, Inc.

    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:wii:bpaper:077. 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: Customer service (email available below). General contact details of provider: https://edirc.repec.org/data/wiiwwat.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.