The Impact of Remittances on Poverty and Inequality in Ghana

Adams, Richard H., Jr.; Cuecuecha, Alfredo; Page, John

The Impact of Remittances on Poverty and Inequality in Ghana

Autores

Adams, Richard H., Jr.

Cuecuecha, Alfredo

Page, John

Editor

World Bank, Washington, DC

Descripción

This paper uses a new, 2005/06 nationally-representative household survey to analyze the impact of internal remittances (from Ghana) and international remittances (from African and other countries) on poverty and inequality in Ghana. To control for selection and endogeneity, it uses a two-stage multinomial logit model with instrumental variables focusing on variations in migration networks and remittances among various ethno-religious groups in Ghana. The paper finds that both internal and international remittances reduce the level, depth, and severity of poverty in Ghana. However, the size of the poverty reduction depends on the type of remittances received. In general, poverty in Ghana is reduced more by international than internal remittances. For households receiving international remittances, the level of poverty falls by 88.1 percent with the inclusion of remittances; for households receiving internal remittances, poverty falls by 69.4 percent with the inclusion of remittances. The paper also finds that both types of remittances increase income inequality in Ghana. For households with internal remittances, the inclusion of remittances causes the Gini coefficient to rise by 4 percent, and for households with international remittances, the inclusion of remittances causes the Gini to increase by 17.4 percent.

Palabras clave

ACCESS TO RESOURCES, ACCOUNTING, AGRICULTURAL ECONOMICS, AMOUNT OF REMITTANCES, AVERAGE VALUE OF REMITTANCES, BANK POLICY, CAPITA REMITTANCES, COUNTERFACTUAL, CURRENCY, CURRENCY CRISIS, DATA ON REMITTANCES, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DISTRIBUTION OF REMITTANCES, EARNINGS, ECONOMIC CHARACTERISTICS, ECONOMIC DEVELOPMENT, ECONOMIC SHOCKS, ECONOMIC STATUS, EFFECT OF REMITTANCES, EFFECTS OF REMITTANCES, ENTREPRENEURIAL ACTIVITY, EQUIPMENT, ETHNIC GROUPS, EXCHANGE RATE, EXPENDITURE, EXPENDITURES, FAMILY TIES, FEMALE-HEADED HOUSEHOLDS, FEWER CHILDREN, FOOD GOODS, FOOD POLICY, FOOD REQUIREMENTS, GENDER, GROUP ACCOUNTS, HOUSEHOLD COMPOSITION, HOUSEHOLD HEAD, HOUSEHOLD INCOME, HOUSEHOLD INCOMES, HOUSEHOLD SIZE, HOUSEHOLD SURVEY, HOUSEHOLD WELFARE, HUMAN CAPITAL, IMPACT OF MIGRATION, IMPACT OF REMITTANCES, IMPACT ON POVERTY, INCOME DISTRIBUTION, INCOME FLOWS, INCOME INEQUALITY, INCOME TRANSFERS, INFLATION, INSTRUMENT, INTERNAL MIGRANTS, INTERNAL MIGRATION, INTERNATIONAL BANK, INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE, INTERNATIONAL MIGRANTS, INTERNATIONAL MIGRATION, INTERNATIONAL REMITTANCE, INTERNATIONAL REMITTANCES, LABOR FORCE, LABOR MARKET, LABOUR FORCE, LEVEL OF POVERTY, LIVING CONDITIONS, LIVING STANDARDS, MICRO-ENTERPRISES, MIGRANT, MIGRANT NETWORKS, MIGRANT WORKERS, MIGRATION, NATIONAL POVERTY, NATIONAL POVERTY LINE, NUMBER OF CHILDREN, NUMBER OF HOUSEHOLDS, POLICY RESEARCH, POLICY RESEARCH WORKING PAPER, POOR, POOR COUNTRIES, POOR HOUSEHOLDS, POOR PEOPLE, POOR PERSON, POVERTY GAP, POVERTY HEADCOUNT INDEX, POVERTY INDEX, POVERTY LINE, POVERTY MEASURES, POVERTY RATES, POVERTY REDUCTION, POVERTY STATUS, PRIMARY EDUCATION, PRIMARY SCHOOL, PROGRESS, RECEIPT, REGIONAL DUMMIES, RELIGIOUS GROUPS, REMITTANCE, REMITTANCE FLOWS, REMITTANCE-RECEIVING HOUSEHOLDS, REMITTANCES, REMITTANCES REMITTANCES, RESPECT, RETURN, RETURNS, RURAL, RURAL AREAS, RURAL PRODUCTIVITY, SAVINGS, SECONDARY EDUCATION, SECONDARY SCHOOL, SECONDARY SCHOOL EDUCATION, SOCIAL NETWORK, SOCIAL NETWORKS, SQUARED POVERTY GAP INDEX, SUB-SAHARAN AFRICA, TYPES OF REMITTANCES, UNIVERSITY EDUCATION, URBAN AREAS, VALUE OF REMITTANCES, VILLAGE