Impact of Remittance on Consumption and Savings Behavior in Rural Areas of Bangladesh

Mohammed Ziaul Haider (), Tanbir Hossain () and Ohidul Islam Siddiqui ()
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Mohammed Ziaul Haider: Professor, Economics Discipline, Khulna University, Khulna-9208, Bangladesh.
Tanbir Hossain: Lecturer, North Western University, Khulna, Bangladesh
Ohidul Islam Siddiqui: Professor, ISRT, University of Dhaka, Dhaka, Bangladesh

Journal of Business, 2016, vol. 1, issue 4, 25-34

Abstract: This study measures the impact of remittance on consumption and savings behavior though surveying rural households in Bangladesh. It uses hypothesis testing to compare consumption and savings behavior and path model analysis to trace out the impact of remittance on household level consumption and savings behavior in rural areas of Bangladesh. The remittance receiver households receive US$ 358 monthly remittance on an average. The average monthly food expenditure, aggregate expenditure and savings of a remittance receiver household are about US $28, $32 and $10 higher than that of a non-receiver household. The path model analysis findings indicate that remittance has a statistically significant positive impact on attributing food and aggregate consumption expenditure in addition to savings. Therefore, this study concludes that remittance plays an important role in attributing consumption and savings behavior in the selected rural areas of the south-west region of Bangladesh. However, further study addressing randomness in the sample selection process with wider sample and study area coverage might enhance the robustness of the study findings.

Keywords: Consumption; Household; Remittance; Rural Bangladesh. (search for similar items in EconPapers)
JEL-codes: D10 E21 F24 O18 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:lrc:larjob:v:1:y:2016:i:4:p:25-34

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