Distributive impact of domestic and international private remittances in Senegal[Impact distributif des transferts privés domestiques et internationaux au Sénégal]

The objective of this article is to assess the distributive impact of private transfers received by households in Senegal using data from the Senegal Poverty Monitoring Survey of 2011. This assessment is based on the comparison of the distribution of disposable income compared to that of counterfactual income in the absence of transfers. This counterfactual income is constructed according to two scenarios. The results of the first scenario, assuming that private transfers received have no effect on household behavior, indicate that private transfers are equalizing as disposable income is more egalitarian than counterfactual income excluding transfers. The equalizing effect of private transfers appears to be mainly driven by domestic private transfers. Lifting the assumption that transfers are exogenous, the second scenario suggests that the indirect effect of private transfers is potentially very significant and even more equalizing than the direct effect. While the literature rather emphasizes the distributive impact of international transfers, the results obtained here highlight the important role that private domestic transfers might play in reducing income inequality.