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Are remittances spent in a healthy way? Evidence from Albania

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  • Kalaj, Ermira Hoxha

Abstract

This article investigates the effect of remittances on health capital accumulation. Total expenditure is divided into expenditure on medicines; and expenditure on visits and laboratory services. An estimation is presented for rural and urban sub-groups. Both instrumental variable and propensity score matching are used to assess the impact of remittances on health capital investment. Households increase their expenditure on medicines and other health services in the presence of remittances. This positive relationship is statistically significant in the case of remittance-receiving households living in rural areas, although the magnitude is lower in the case of total expenditure on visits and laboratory services. However, total expenditure here is likely to have a significant impact on health outcomes given their preventive nature. Remittance flows thus play a heterogeneous role in the decision-making processes of remittance-receiving household members. However, such non-labour income flows may play an important role in supporting expenditures, especially for those living in rural areas.

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  • Kalaj, Ermira Hoxha, 2014. "Are remittances spent in a healthy way? Evidence from Albania," SEER Journal for Labour and Social Affairs in Eastern Europe, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 17(2), pages 237-266.
    • Handle: RePEc:nms:joseer:10.5771/1435-2869-2014-2-237
    DOI: 10.5771/1435-2869-2014-2-237
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    More about this item

    JEL classification:

    • C36 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Instrumental Variables (IV) Estimation
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development

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