Description

This paper uses a 4-year rural panel survey from El Salvador to analyze the effects of international migration and remittances on labor force participation. To account for the possible endogeneity of remittances, the author uses a fixed effects probit on the 4-year panel. Results suggest that with the receipt of international remittances, labor force participation falls more for women than for men. For instance, urban females in remittance-receiving households are 42.2 percent more likely to quit the labor market, while urban males in remittance-receiving households are only 9 percent more likely to quit. The authors also find both males and females reduce their total hours worked per week when they receive remittances. Urban males and females in remittance-receiving households reduce their hours worked per week by 24.4 and 20.8 percent, respectively.