The publisher, Oxford Journals, did not grant permission to reproduce this article for public access. To buy this article please visit http://wber.oxfordjournals.org/cgi/content/abstract/21/2/219?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=wber&searchid=1&FIRSTINDEX=0&sortspec=relevance&resourcetype=HWCIT.


This paper investigates whether remittances sent by overseas migrants serve as insurance for recipient households using a nationally representative household survey from the Philippines.  The authors find that remittances from international migration respond to income shocks experienced by Philippine households.  In particular, changes in income are found to lead to changes in remittances in the opposite direction, consistent with insurance motives. About 60 percent of declines in household income are replaced by remittance inflows from overseas. Because household income and remittances are jointly determined, rainfall shocks are used as an instrumental variable for income changes. The authors conclude that while consumption in households with migrant members is unchanged in response to income shocks, while consumption responds strongly to income shocks in households without migrants.

Publication Details

Title
Are Remittances Insurance? Evidence from Rainfall Shocks in the Philippines
Authors
Yang, Dean C, Choi, HwaJung
Publisher
University of Oxford / Oxford University Press
Publish Date
2007
Citation
Yang, Dean C, Choi, HwaJung, Are Remittances Insurance? Evidence from Rainfall Shocks in the Philippines (University of Oxford / Oxford University Press, 2007).
Menu