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Bank Account and Savings - The Impact of Remittances and Migration: A Case Study of Moldova

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  • Fernando Rios Avila
  • Eva Schlarb

Abstract

In many developing countries, the formal financial sector is underdeveloped and majority of the population does not have access to it. This paper analyzes the empirical link between remittances and financial sector development on a microeconomic level. Using a unique household dataset for Moldova, we find that receiving monetary remittances has a positive and significant effect on the probability of having a bank account, thereby promoting financial sector development. Furthermore, we show that remittances tend to have an even higher positive effect on household savings, which is a sign for a hidden potential for financial sector development.

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File URL: http://www.ifw-kiel.de/ausbildung/asp/asp-wp/2008/aspwp448.pdf
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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Advanced Studies Working Papers with number 448.

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Length: 31 pages
Date of creation: May 2008
Date of revision:
Handle: RePEc:kie:kieasw:448

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Cited by:
  1. Luecke, Matthias & Omar Mahmoud, Toman & Steinmayr, Andreas, 2009. "Labour migration and remittances in Moldova: Is the boom over?: Trends and preliminary findings from the IOM-CBSAXA panel household survey 2006- 2008," Open Access Publications from Kiel Institute for the World Economy 32525, Kiel Institute for the World Economy (IfW).

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