Divergences in expatriating, remitting and investing remittances between semi-urban and rural Bangladesh

M. Aminul Islam Akanda

International Journal of Development Issues, 2018, vol. 17, issue 3, 288-304

Abstract: Purpose - The purpose of this study is to explore the pattern of expansion of overseas market for wage earners, inflow of remittances, its disposal pattern and the extent of non-productive investments. Design/methodology/approach - It analyzed behavioral differences between semi-urban and rural households using primary data collected from 78 remittance recipients in Comilla district. Most of the results were produced using arithmetic analytical tools. Besides, one regression model was fit to quantify the effect of a few identical factors on remittance receipts for semi-urban and rural households. Findings - Members of semi-urban families were early expatriates, who remitted larger amount than rural ones. Years of schooling and overseas experiences had larger marginal effects on remittance amount in rural area compared to semi-urban one. However, aging and overseas labor freedom influenced negatively anywhere. Rural households were more cautious in spending who had lower remittance elasticity than that of semi-urban ones except of capital items. Household assets were concentrated to lands, home appliances and gold ornaments, the rate of return of which were one-tenth of market interest rate. Practical implications - Non-productive investments were concentrated the most to land for rural households and to ornaments for semi-urban ones. However, education and healthcare appeared as necessary elements in livelihoods, for which households might move toward human resource-related investment schemes. Originality/value - This study measured the sensitivity with household spending to remittance receipts and why the remittance was not moving into productive schemes in the process of urbanization.

Keywords: Non-productive; investment (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijdipp:ijdi-12-2017-0208

DOI: 10.1108/IJDI-12-2017-0208

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