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Do Migrants Really Save More? Understanding the Impact of Remittances on Savings in Rural China

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  • Yu Zhu

    ()

  • Zhongmin Wu
  • Meiyan Wang
  • Yang Du
  • Fang Cai

Abstract

This paper studies the impact of remittances on the savings behaviour of rural households in China, using a cross-sectional survey. Allowing for endogeneity and left-censoring of remittances, we find that the marginal propensity to save out of remittances is well below half of that out of other sources of incomes. Moreover, we find no evidence of any direct effect of remittances on either capital input or gross output of farm production. These findings are in line with recent studies which conclude that remittances are largely used for consumption purposes by rural Chinese households and there is no link between migration and productive investment.

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Bibliographic Info

Paper provided by Department of Economics, University of Kent in its series Studies in Economics with number 0923.

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Date of creation: Dec 2009
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Handle: RePEc:ukc:ukcedp:0923

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Postal: Department of Economics, University of Kent at Canterbury, Canterbury, Kent, CT2 7NP
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Keywords: Growth and cycles; recessions; technical efficiency; technical progress.;

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Cited by:
  1. Luc Christiaensen & Lei Pan, 2010. "Transfers and Development: Easy Come, Easy Go?," Working Paper Series wp2010-125, World Institute for Development Economic Research (UNU-WIDER).

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