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The consumption-enhancing effect of remittances: Evidence from Kosovo

Laetitia Duval and François-Charles Wolff ()

No 107, wiiw Balkan Observatory Working Papers from The Vienna Institute for International Economic Studies, wiiw

Abstract: In this paper, we study the effect of remittances on the living standard of families living in Kosovo using detailed data conducted in 2010 on a sample of 4,000 households. Specifically, we focus on the impact of these transfers on welfare proxied by per capita consumption expenditure at various locations of the consumption distribution. Drawing on quantile regressions, we find that remittances significantly improve the living standard of the recipient households. The benefit of remittances is much higher among households characterized by low levels of consumption, especially when the possible endogeneity of remittances is taken into account in the estimation. Finally, we show that the positive impact of remittances on consumption has remained constant between 2000 and 2010.

Keywords: Remittances; consumption; poverty; inequality; Kosovo (search for similar items in EconPapers)
JEL-codes: I32 D12 (search for similar items in EconPapers)
Date: 2013-01
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Published as wiiw Balkan Observatory Working Paper

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