The Impact of International Remittances on Income, Work Efforts, Poverty and Inequality: Evidence from Vietnam
AbstractThis study provides new empirical evidence on the impact of international remittances. Using data from the two most recent Vietnam Household and Living Standard Surveys, the paper estimates the effect of remittances on per capita income, per capita expenditure, work efforts, poverty and inequality. The estimates suggest that a rise in international remittances in Vietnam increases household income and expenditure. Yet, the study also finds evidence that international remittances may create a moral hazard problem by inducing disincentives to work. Moreover, the study suggests that international remittances, at the least in the short run, do not reduce poverty. They may even lead to an increase in inequality. Overall, the study casts doubts on the view that international remittances may play a crucial role in reducing poverty in developing countries.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 50313.
Date of creation: 20 Dec 2009
Date of revision:
Remittances; poverty; expenditure; income; household survey; Vietnam;
Find related papers by JEL classification:
- F3 - International Economics - - International Finance
- I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
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