TY  - JOUR
AU  - Yang,Dean
TI  - International Migration, Remittances, and Household Investment: Evidence from Philippine Migrants' Exchange Rate Shocks
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12325
PY  - 2006
Y2  - June 2006
UR  - http://www.nber.org/papers/w12325
L1  - http://www.nber.org/papers/w12325.pdf
N1  - Author contact info:
Dean Yang
University of Michigan
Gerald R. Ford School of Public Policy
and Department of Economics
735 S. State Street, Room 3316
Ann Arbor, MI 48109
Tel: 734/764-6158
Fax: 734/763-9181
E-Mail: deanyang@umich.edu
M2  - featured in NBER digest on 2006-06-26
AB  - Millions of households in developing countries receive financial support from family members working overseas. How do migrant earnings affect origin-household investments? This paper examines Philippine households%u2019 responses to overseas members%u2019 economic shocks. Overseas Filipinos work in dozens of foreign countries, which experienced sudden (and heterogeneous) changes in exchange rates due to the 1997 Asian financial crisis. Appreciation of a migrant%u2019s currency against the Philippine peso leads to increases in household remittances received from overseas. The estimated elasticity of Philippine-peso remittances with respect to the Philippine/foreign exchange rate is 0.60. These positive income shocks lead to enhanced human capital accumulation and entrepreneurship in migrants%u2019 origin households. Child schooling and educational expenditure rise, while child labor falls. In the area of entrepreneurship, households raise hours worked in self-employment, and become more likely to start relatively capital-intensive household enterprises.
ER  -