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The Effects of International Remittances on Poverty and Inequality in Ethiopia

  • Beyene, Berhe Mekonnen

    ()

    (Dept. of Economics, University of Oslo)

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    The paper studies the effects of international remittances on poverty and inequality in Ethiopia using an urban household survey from 2004. In order to identify the effects of remittances on poverty and inequality, counterfactual consumption in the hypothetical case of no remittance is estimated in a selection corrected estimation framework. Inequality and poverty values in the hypothetical and actual cases are then compared. There is a significant reduction in poverty while inequality does not change. The head count, the poverty gap and the squared poverty gap ratios decreased by 2.5%, 1.1% and 0.6% respectively.

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    File URL: https://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2012/Memo-13-2012.pdf
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    Paper provided by Oslo University, Department of Economics in its series Memorandum with number 13/2012.

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    Length: 37 pages
    Date of creation: 15 Mar 2012
    Date of revision:
    Handle: RePEc:hhs:osloec:2012_013
    Contact details of provider: Postal:
    Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway

    Phone: 22 85 51 27
    Fax: 22 85 50 35
    Web page: http://www.oekonomi.uio.no/indexe.html
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    1. Tigran A. Melkonyan & David A. Grigorian, 2008. "Microeconomic Implications of Remittances in an Overlapping Generations Model with Altruism and Self-Interest," IMF Working Papers 08/19, International Monetary Fund.
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    3. David Mckenzie & Hillel Rapoport, 2004. "Network Effects and the Dynamics of Migration and Inequality: Theory and Evidence from Mexico," Working Papers 2004-3, Bar-Ilan University, Department of Economics.
    4. Glaeser, Edward & Scheinkman, Jose & Shleifer, Andrei, 2003. "The injustice of inequality," Journal of Monetary Economics, Elsevier, vol. 50(1), pages 199-222, January.
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    7. Adams, Richard H. Jr., 2005. "Remittances, household expenditure and investment in Guatemala," Policy Research Working Paper Series 3532, The World Bank.
    8. Acosta, Pablo & Calderon, Cesar & Fajnzylber, Pablo & Lopez, Humberto, 2007. "What is the impact of international remittances on poverty and inequality in Latin America ?," Policy Research Working Paper Series 4249, The World Bank.
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    16. Christopher Cramer, 2003. "Does inequality cause conflict?," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(4), pages 397-412.
    17. Edwards, Alejandra Cox & Ureta, Manuelita, 2003. "International migration, remittances, and schooling: evidence from El Salvador," Journal of Development Economics, Elsevier, vol. 72(2), pages 429-461, December.
    18. Dean Yang & HwaJung Choi, 2005. "Are Remittances Insurance? Evidence from Rainfall Shocks in the Philippines," Working Papers 535, Research Seminar in International Economics, University of Michigan.
    19. Cameron,A. Colin & Trivedi,Pravin K., 2005. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9780521848053, 1.
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