Measuring Dynamic Effects of Remittances on Poverty and Inequality with Evidence from Kosovo

Arjola Arapi-Gjini, Judith Möllers and Thomas Herzfeld

Eastern European Economics, 2020, vol. 58, issue 4, 283-308

Abstract: This paper investigates dynamic effects of remittances on households’ poverty and income distribution. Using state-of-the-art matching techniques, we measure impacts based on counterfactual scenarios, and make a step forward by applying for the first time a dose-response function approach to assess poverty effects due to variations in the time-length of receiving remittances. Our results suggest that remittances alleviate both absolute and relative poverty levels and lead to a marginal increase in inequality in the case of Kosovo. We further demonstrate that – although poverty reduction effects are stronger in the short-run – remittances have a positive poverty reduction effect over time. These findings have important welfare policy implications for low- and middle income economies with a high dependency on remittances.

Date: 2020
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Working Paper: Measuring Dynamic Effects of Remittances on Poverty and Inequality with Evidence from Kosovo (2021)
Journal Article: Measuring dynamic effects of remittances on poverty and inequality with evidence from Kosovo (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:mes:eaeuec:v:58:y:2020:i:4:p:283-308

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DOI: 10.1080/00128775.2020.1720517

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