brain drain remittances and fertility this paper analyzes the effects of skilled migration and remittances on fertility decisions at origin we develop an overlapping generations model which accounts for endogenous fertility and education parents choose the number of children they want to raise and decide upon how many children obtain higher education only high skilled individuals migrate with a certain probability and remit to their parents we find that an increase in the probability to emigrate leads both high and low skilled parents to send more children to obtain higher education however the effect on the number of children is ambiguous in a further analysis we calibrate the model to match different characteristics of a developing economy when the destination country relaxes the immigration restrictions more high skilled individuals leave the origin country the result is that at origin increased high skilled emigration reduces fertility and fosters human capital accumulation

an economic theory of self control the concept of self control is incorporated in a theory of individual intertemporal choice by modeling the individual as an organization the individual at a point in time is assumed to be both a farsighted planner and a myopic doer the resulting conflict is seen to be fundamentally similar to the agency conflict between the owners and managers of a firm both individuals and firms use the same techniques to mitigate the problems which the conflicts create this paper stresses the implications of this agency model and discusses as applications the effect of pensions on saving saving and the timing of income flows and individual discount rates

the ant and the grasshopper understanding personal saving orientation of consumers a low savings rate is a persistent social issue with significant present and future ramifications as an alternative to conceptualizing saving money as goal directed behavior the present research examines the chronic tendencies of people to save money in a consistent and sustained manner through a personal saving orientation pso drawing upon theorizing on action control and research on forming and maintaining habits the pso emphasizes consistent sustainable saving activities and incorporating them into one s lifestyle in a set of nine studies the pso scale is developed and its nomological test retest discriminant and predictive validities are established the results also show that the pso moderates the relationship between consumers financial knowledge and their accumulated savings additionally low pso consumers are responsive to an intervention to help them save money the pso offers an effective method for understanding differences between consumers in their financial decision making and behaviors and it can be used as a guide to encourage consistent and sustained saving practices

the impacts of international migration on remaining household members omnibus results from a migration lottery program this brief summarizes the results of a gender impact evaluation study entitled the impacts of international migration on remaining household members omnibus results from a migration lottery program conducted in 2002 in tonga the study observed the impact of migration lottery program on the remaining household members of tongan emigrants on the individual and intra household level income falls rapidly by 22 to 25 percent with a rise in remittances failing to offset a large fall in labor earnings ownership of livestock durable and access to financial services is lower for the remaining household members diets change to be less nutritious and more rice and root crops immigration has a negative impact on household size there is no significant impact of migration on labor supply for men nor women funding for the study derived from the world bank stanford university the waikato management school and mardsen fund

credit market constraints consumption smoothing and the accumulation of durable production assets in low income countries investments in bullocks in india in this paper we formulate and estimate a finite horizon structural dynamic model of agricultural investment behavior that incorporates the major features of low income agricultural environments income uncertainty constraints on borrowing and rental markets and the use of investment assets to generate income and smooth consumption the model is fit to longitudinal indian household data on farm profits bullock stocks and pump sets the estimated structural parameters are used to assess the effects on the life cycle accumulation of bullocks agricultural profits and welfare associated with complete markets and bullock liquidity and with second best policies that provide assured sources of income to farmers and weather insurance

productivity of public and private investment in developing countries a broad international perspective abstract using reasonably good data for 1973 1980 1980 1985 and 1985 1990 for 53 developing countries fairly standard growth models are estimated to compare the productivity of public investment with that of private investment the main point noted is that public investment appears more productive than private investment in at least as many instances as suggest the opposite much caution is therefore urged in making strong claims about the productivity of private investment in developing countries being higher than that of public investment

remittances investment and rural asset accumulation in pakistan internal and external migration can have a profound impact on rural asset accumulation in most third world countries in many african asian and latin american countries the bulk of the labor force still lives in the countryside in these countries the large difference between expected rural and urban or foreign incomes coupled with the risk reducing functions of migration causes workers to migrate either to urban centers or abroad the remittances defined as the money or goods sent home by migrant workers can have a large effect on the accumulation of assets in these rural areas for example an inflow of external remittances to rural households at the upper end of the income distribution could increase land accumulation by the rich in general terms the effect of remittances on asset accumulation in a rural third world economy depends on answers to three questions a who migrates b how much net income do migrants remit and c what are the marginal effects of these remittances on household consumption and investment because of data limitations in this article i propose to examine only the first and the third questions other researchers have addressed the second issue in the past surprisingly little attention has been focused on the question of the marginal effects of remittances on household consumption and investment in the rural third world this inattention has been due to three considerable methodological problems the first is fungibility because remittances are like any other form of cash income it is difficult to associate this income source with any particular changes in household expenditure behavior the second problem relates to the multiple round effects of remittances on the local economy for example an inflow of remittances into a rural area may lead to a surge in expenditures in housing which may in turn create new income and employment opportunities for the poor and unskilled unfortunately however few studies have

remittances and household wealth after conflict a case study on urban burundi few studies have researched the use of remittances in conflict affected contexts this study analyzes unique data from burundi testing three hypotheses relative deprivation investment and insurance derived from new economics of labor migration studies employing propensity score matching results show that remittances are common among wealthier households rejecting the relative deprivation hypothesis remittances have strong effects on non productive assets such as living conditions and food security and weak effects on productive assets such as asset ownership poorer households invest mostly in non productive assets suggesting that remittances are insurance for the poor whereas wealthier households seem largely unaffected by remittances

livelihoods and poverty the role of migration a critical review of the migration literature this review of the literature concludes that development studies have paid insufficient attention to labour migration and makes a plea to integrate analyses of migration within those of agricultural and rural development it emphasises that population mobility is much more common than is often assumed and that this has been so throughout human history in fact available material suggests that it is as likely that population mobility has decreased as that it has increased a review of empirical studies shows that it may not be possible to generalise about the characteristics of migrants or about the effects of migration on broader development inequality or poverty the review concludes that given the importance of migration for the rural livelihoods of many people policies should be supportive of population mobility and possibilities should be explored to enhance the positive effects of migration

effects of patent policy on income and consumption inequality in a r d growth model what are the effects of strengthening patent protection on income and consumption inequality to analyze this question this paper incorporates heterogeneity in the initial wealth of households into a canonical quality ladder growth model with endogenous labor supply in this model i firstly show that the aggregate economy always jumps immediately to a unique and stable balanced growth path given the balanced growth behavior of the aggregate economy and an exogenous distribution of initial wealth i then show that the endogenous distribution of assets in subsequent periods is stationary and equal to its initial distribution the model predicts that strengthening patent protection increases a economic growth by stimulating r d investment and b income inequality by raising the return on assets however whether it also increases consumption inequality depends on the elasticity of intertemporal substitution if and only if this elasticity is less greater than unity strengthening patent protection increases decreases consumption inequality for standard parameter values strengthening patent protection leads to a larger increase in income inequality than consumption inequality

remittances financial development and growth abstract despite the increasing importance of remittances in total international capital flows the relationship between remittances and growth has not been adequately studied this paper studies one of the links between remittances and growth in particular how local financial sector development influences a country s capacity to take advantage of remittances using a newly constructed dataset for remittances covering about 100 developing countries we find that remittances boost growth in countries with less developed financial systems by providing an alternative way to finance investment and helping overcome liquidity constraints this finding controls for the endogeneity of remittances and financial development does not depend on the particular measure of financial sector development used and is robust to a number of robustness tests including threshold estimation we also provide evidence that there could be an investment channel trough which remittances can promote growth especially when the financial sector does not meet the credit needs of the population

migration and income diversification evidence from burkina faso this paper uses limited dependent variable methods and new data from burkina faso to test the impact of inter continental and continental migration on activity choice and incomes in rural households econometric evidence supports our theoretical expectation that the impact of emigration varies both by migrant destination and production activity we find no evidence of either positive or negative effects of continental migration on agricultural or livestock activities and only a small negative impact on non farm activities however inter continental migration which tends to be long term and generates significantly larger remittances stimulates livestock production while being negatively associated with both staple and non farm activities

does front loading taxation increase savings evidence from roth 401 k introductions can governments increase private savings by taxing savings up front instead of in retirement roth 401 k contributions are not tax deductible in the contribution year but withdrawals in retirement are untaxed the more common before tax 401 k contribution is tax deductible in the contribution year but both principal and investment earnings are taxed upon withdrawal using administrative data from eleven companies that added a roth contribution option to their existing 401 k plan between 2006 and 2010 we find no evidence that total 401 k contribution rates differ between employees hired before versus after the roth introduction which means that the amount of retirement consumption being purchased by 401 k contributions increases after the roth introduction a survey experiment suggests two behavioral factors play a role in the unresponsiveness of contribution rates to their tax treatment 1 employee confusion about or neglect of the tax properties of roth balances and 2 partition dependence

the bottom dollar effect the influence of spending to zero on pain of payment and satisfaction spending that exhausts a budget is shown to decrease satisfaction with purchased products relative to spending when resources remain in the budget six studies including those in which participants earn and spend real resources and evaluate real products explore this bottom dollar effect this research contributes to prior mental accounting research regarding how costs influence decision making e g bundling coupling sunk costs and to the satisfaction literature supporting the role of pain of payment in this process we show that the bottom dollar effect increases as effort required to earn budgetary resources increases decreases in the presence of windfall gains and decreases when there is less time between budget exhaustion and replenishment mediation analyses further demonstrate the role of payment pain in the bottom dollar effect implications are discussed in the context of behavioral research marketing promotions management and public policy

migration transfers and economic decision making among agricultural households an introduction abstract the increasing volume of remittances and public transfers in rural areas of the developing world has raised hopes that these inflows may serve as an effective mechanism for reducing poverty in the long term by facilitating investments and raising productivity particularly in agriculture where market failures are most manifest the seven papers in this special issue systematically test the relationship between transfers and productive spending amongst rural households in six different countries overall the studies embrace a less optimistic view of the role of migration and public and private transfers on agriculture with migration as facilitating a transition away from agriculture or to models of less labour intensive agriculture

insurance market efficiency and crop choices in pakistan this paper tests the efficiency of insurance markets in the pakistan punjab by examining how crop choices are affected by the presence of price and yield risk we estimate reduced form and structural models of crop choices although we cannot reject the hypothesis that village members efficiently share risk among themselves production choices are shown to depend on risk existing risk sharing and selfinsurance mechanisms thus imperfectly protect punjab farmers against village level shocks results also indicate that households respond to consumption price risk thereby suggesting that empirical and theoretical work on risk should avoid putting an exclusive emphasis on yield and output price risk

the fewer the better number of goals and savings behavior abstract this article examines the effect of the number of goals on consumers savings behavior drawing from research on implementation intention the authors show that under certain conditions presenting a single savings goal leads to greater savings intention and actual savings than presenting multiple savings goals multiple goals typically evoke trade offs among competing goals and thus increase the likelihood that people will remain in a deliberative mind set and defer actions in contrast the authors propose and demonstrate that a single goal evokes a stronger implementation intention which in turn has a greater effect on behavior change they also show that the advantage of a single goal over multiple goals on saving is attenuated when saving is easier to implement or when the multiple savings goals are integrated rather than competing among themselves theoretical and practical implications are discussed

does migration raise agricultural investment an empirical analysis for rural mexico the effect of remittances on capital accumulation remains a contested topic this paper uses a panel data set from rural mexico to investigate the impact of remittances on agriculture and livestock investments after controlling for the endogeneity of migration through an instrumental variable estimation our empirical results show that international migration has a significantly positive effect on the accumulated agricultural assets but not on livestock capital this suggests that households use the capital obtained from international migration only to overcome liquidity constraints for subsistence production whereas migration itself seems to be the superior investment option compared to other productive activities such as livestock husbandry

temporary emigration and welfare the case of low skilled labor this article studies the implications of temporary emigration for the welfare of a source country the framework is one of general equilibrium where the economy s stocks of both capital and labor are endogenously determined by the saving and migration decisions of optimizing agents simulations of the model suggest that for realistic values of the parameters welfare of nonmigrants of the source country is maximized when the migrants are employed abroad for a period in the range of roughly 8 12 years the ideal duration is found to be an increasing function of the international wage differential migration costs and the degree to which the rights of migrants are protected in the host country

underinvestment in a profitable technology the case of seasonal migration in bangladesh hunger during pre harvest lean seasons is widespread in the agrarian areas of asia and sub saharan africa we randomly assign an 8 50 incentive to households in rural bangladesh to temporarily out migrate during the lean season the incentive induces 22 of households to send a seasonal migrant their consumption at the origin increases significantly and treated households are 8 10 percentage points more likely to re migrate 1 and 3 years after the incentive is removed these facts can be explained qualitatively by a model in which migration is risky mitigating risk requires individual specific learning and some migrants are sufficiently close to subsistence that failed migration is very costly we document evidence consistent with this model using heterogeneity analysis and additional experimental variation but calibrations with forward looking households that can save up to migrate suggest that it is difficult for the model to quantitatively match the data we conclude with extensions to the model that could provide a better quantitative accounting of the behavior

mental budgeting and consumer decisions consumers often set budgets for categories of expenses e g entertainment and track expenses against their budget because budgets cannot perfectly anticipate consumption opportunities people may earmark too much or too little money for a particular category this leads them to overconsume or underconsume goods in that category the results of three studies suggest that consumers do indeed set budgets and that budgeting may lead to underconsumption to show that consumers track expenses the studies demonstrate that budgeting effects are larger for purchases that are highly typical of their category such purchases reduce the amount people spend in a category and block the purchase of other typical items the studies control for satiation and income effects thus budgeting adds predictive power to standard economic consumer theory

the impact of migration on rural poverty and inequality a case study in china large numbers of agricultural labor moved from the countryside to cities after the economic reforms in china migration and remittances play an important role in transforming the structure of rural household income this article examines the impact of rural to urban migration on rural poverty and inequality in a mountainous area of hubei province using the data of a 2002 household survey since migration income is a potential substitute for farm income we present counterfactual scenarios of what rural income poverty and inequality would have been in the absence of migration our results show that by providing alternatives to households with lower marginal labor productivity in agriculture migration leads to an increase in rural income in contrast to many studies that suggest that the increasing share of nonfarm income in total income widens inequality this article offers support for the hypothesis that migration tends to have egalitarian effects on rural income for three reasons 1 migration is rational self selection farmers with higher expected return in agricultural activities and or in local nonfarm activities choose to remain in the countryside while those with higher expected return in urban nonfarm sectors migrate 2 households facing binding constraints of land supply are more likely to migrate 3 poorer households benefit disproportionately from migration

psychology and savings policies many observers of the current economic scene are concerned about the low rate of personal saving in the united states one well known researcher laurence kotlikoff 1992 calls the situation a crisis he proposes that each american worker receive an annual statement from the social security administration with projected benefits upon retirement arguing that if each of us got this statement our attention would be caught and perhaps our psychology of saving which is in such urgent need of redress would really change p 107 i agree with the thrust of kotlikoff s recommendations and join him in applauding steps that will alter the general public s psychology of saving however as economists we need to recognize that the economic theory of saving is similarly in urgent need of redress if we are to understand why people are saving so little and are to make helpful recommendations as to how to get people to save more we have to incorporate more of the psychology of saving into our economic theories kotlikoff s policy proposal while a sensible one highlights the growing gap between theory and policy prescription in this domain if households are acting in accordance with the life cycle theory of saving then undersaving is impossible so why do they need to have their psychology redressed and how does this psychology fit into the model this example reflects an increasing frustration in the economics community about personal saving many observers have come to the conclusion that the low saving rate represents an important problem on two fronts macroeconomists worry that the low saving rate will produce too little investment and microeconomists worry that individuals particularly the baby boomers are not putting enough away to finance a satisfactory lifestyle in retirement these are serious concerns however the frustration comes from the realization that even if there was agreement that the saving rate needs to go up economic theory offers little help in constructing a solution in the standard life cycle framework the only policy variable is the after tax rate of return to saving yet it is well known that the theory does not specify the sign of the relationship between the saving rate and the interest rate raising the interest rate increases the returns to saving but decreases the amount of saving necessary to yield any given future consumption level furthermore empirical estimates offer little help most studies are unable to reject the hypothesis that the elasticity of personal saving with respect to the interest rate is zero clearly this is frustrating the theory only gives us one lever to use and we don t know whether to push or pull with this background i wish to supply what should be considered good news the theory is misspecified life cycle models of saving fail to describe actual household saving in three important ways this failure of the theory is good news because by incorporating some basic psychology we can enrich the theory and generate specific policy recommendations in this paper i will begin by characterizing the problems with the theory and then go on to discussing the implications of modifying the theory

migration remittances and capital accumulation evidence from rural mexico this paper studies the link between migration remittances and productive assets accumulation for a panel of poor rural households in mexico over the period 19972006 in a context of nancial markets imperfections migration may act as a substitute for imperfect credit and insurance provision through remittances from migrants and thus exert a positive eect on investment however it may well be the case that remittances are channelled towards increasing consumption and leisure goods exploiting within family variation and an instrumental variable strategy we show that migration indeed accelerates productive assets accumulation moreover when we look at the eect of migration on consumption of non productive assets durable goods we nd instead a negative eect our results then suggest that

migrant remittances and fertility abstractthis study examines the role of migrants remittances in developing countries fertility transition employing an unbalanced panel of south asian countries and controlling for various economic and socio demographic factors we find that remittances are significantly associated with a lower number of children born to women of childbearing age this suggests the remittances substitution effect to be at play rather than the income effect and may result from decreased need for children for financing the household s future needs as well as from better access to healthcare and contraceptive methods available to migrant households remittances association with fertility appears to be more important than the transfer of fertility norms from migrants host countries the monetary aspects of international migration may therefore be more important for the region s demographic transition than social remittances

the abcs of financial education experimental evidence on attitudes behavior and cognitive biases this paper uses a large scale field experiment in india to study attitudinal behavioral and cognitive constraints that stymie the link between financial education and financial outcomes the study complements financial education with i participant classroom motivation with pay for performance on a knowledge test ii intensity of treatment with personalized financial counseling and iii behavioral nudges with financial goal setting the analysis finds no impact of pay for performance but significant effects of both counseling and goal setting on real financial outcomes these results identify important complements to financial education that can bridge the gap between financial knowledge and financial behavior change

remittances poverty inequality and welfare evidence from the central plateau of burkina faso abstract this paper applies gini and concentration coefficient decomposition as well as the foster greer thorbecke poverty index and the stark yitzhaki welfare index to new data from four villages in burkina faso to compare the marginal effects of remittances from intercontinental and intra african migration on inequality poverty and social welfare evidence is found that intra african remittances reduce inequality while intercontinental remittances have the opposite effect also it is found that although remittances from intercontinental migration are associated with much lower incidence depth and severity of poverty the marginal impact of remittances from this form of migration on social welfare is limited because recipients do not include the rural poor

accounting for selectivity and duration dependent heterogeneity when estimating the impact of emigration on incomes and poverty in sending areas the impacts of international emigration and remittances on incomes and poverty in sending areas are increasingly studied with household survey data but comparing households with and without emigrants is complicated by a triple selectivity problem first households self select into emigration second in some emigrant households everyone moves while others leave members behind and third some emigrants choose to return to the origin country allowing for duration dependent heterogeneity introduces a fourth form of selectivity one must now worry not just about whether households migrate but also when they do so this paper clearly sets out these selectivity issues and their implications for existing migration studies and then addresses them by using survey data designed specifically to take advantage of a randomized lottery that determines which applicants to the over subscribed samoan quota may immigrate to new zealand the analysis compares incomes and poverty rates among left behind members in households in samoa that sent samoan quota emigrants with those for members of similar households that were unsuccessful in the lottery policy rules control who can accompany the principal migrant providing an instrument to address the second selectivity problem while differences among migrants in which year their ballot was selected allow for estimation of duration effects the authors find that migration reduced poverty among former household members but they also find suggestive evidence that this effect may be short lived as both remittances and agricultural income are negatively related to the duration that the migrant has been abroad

migration and technical efficiency in cereal production evidence from burkina faso this article uses a double bootstrap procedure and survey data from burkina faso in a two stage estimation to explore ways in which continental and intercontinental migration determine efficiency in cereal production of rural households findings suggest that continental migration has a positive relation and intercontinental migration no relation with technical efficiency for continental migrant households migration has removed surplus male labor a cause for inefficiency in production intercontinental migration leads to a gender imbalance in the household which cannot be compensated for by investments in farm equipment the failure of intercontinental migration to transform cereal production from traditional to modern is attributed to an imperfect market environment

the behavioral life cycle hypothesis self control mental accounting and framing are incorporated in a behavioral enrichment of the life cycle theory of saving called the behavioral life cycle blc hypothesis the key assumption of the blc theory is that households treat components of their wealth as nonfungible even in the absence of credit rationing specifically wealth is assumed to be divided into three mental accounts current income current assets and future income the temptation to spend is assumed to be greatest for current income and least for future income considerable empirical support for the blc theory is presented primarily drawn from published econometric studies

the effects of international migration on migrant source households evidence from ethiopian diversity visa lottery migrants about a million people have migrated to the us via the diversity visa dv lottery the dv was instituted by an act of the united states congress to diversify the u s population through a lottery made available to people from countries with historically low rates of immigration to the country in any given year the probability of winning the lottery is less than 1 with millions of people from around the world competing for a maximum of 55 000 immigrant visas that can be obtained through this migration channel using ethiopian dv participants which have consistently made up between 6 and 8 of all dv immigrants i study the causal effects of emigration on the well being of the migrant sending families i infer that migration contributes positively to the welfare of the source families overall migration increases consumer expenditure but has no effect on savings and business ownership of the senders the positive treatment effects do not diminish with duration of emigration migrant men contribute more to the increase in their families standard of living than their female counterparts do while expenditure on food and energy are invariant to the migrants gender the gains in terms of durable ownership access to clean water and sanitation facilities occur almost entirely in families where the emigrants are men i find that dv participants are favorably selected relative to the overall population

international migration remittances and household investment evidence from philippine migrants exchange rate shocks how do households respond to overseas members economic shocks overseas filipinos in dozens of countries experienced sudden heterogeneous changes in exchange rates during the 1997 asian financial crisis appreciation of a migrant s currency against the philippine peso leads to increases in household remittances from overseas the estimated elasticity of philippine peso remittances with respect to the exchange rate is 0 60 positive migrant shocks lead to enhanced human capital accumulation and entrepreneurship in origin households child schooling and educational expenditure rise while child labour falls households also work more hours in self employment and become more likely to start relatively capital intensive household enterprises

the effect of partitions on controlling consumption abstract the authors demonstrate that partitioning an aggregate quantity of a resource e g food money into smaller units reduces the consumed quantity or the rate of consumption of that resource partitions draw attention to the consumption decision by introducing a small transaction cost that is they provide more decision making opportunities so that prudent consumers can control consumption thus people are better able to constrain consumption when resources associated with a desirable activity which they are trying to control are partitioned rather than when they are aggregated this effect of partitioning is demonstrated for the consumption of chocolates study 1 and gambles study 2 in study 3 process measures reveal that partitioning increases recall accuracy and decision times importantly the effect of partitioning diminishes when consumers are not trying to regulate consumption studies 1 and 3 finally study 4 explores how habituation may decrease the amount of attention that pa

directing remittances to education with soft and hard commitments evidence from a lab in the field experiment and new product take up among filipino migrants in rome this paper tests how migrants willingness to remit changes when given the ability to direct remittances to educational purposes using different forms of commitment variants of a dictator game in a lab in the field experiment with filipino migrants in rome are used to examine remitting behavior under varying degrees of commitment these range from the soft commitment of simply labeling remittances as being for education to the hard commitment of having funds directly paid to a school and the student s educational performance monitored the analysis finds that the introduction of simple labeling for education raises remittances by more than 15 percent adding the ability to directly send this funding to the school adds only a further 2 2 percent the information asymmetry between migrants and their most closely connected household is randomly varied but no significant change is found in the remittance response to these forms of commitment as information varies behavior in these games is shown to be predictive of take up of a new financial product called edupay designed to allow migrants to pay remittances directly to schools in the philippines this take up seems largely driven by a response to the ability to label remittances for education rather than to the hard commitment feature of directly paying schools

government size and economic growth a new framework and some evidence from cross section and time series data a study of the impact of government size on economic performance and growth is important theoretically one point of view suggests that a larger government size is likely to be detrimental to efficiency and economic growth because for example i government operations are often conducted inefficiently ii the regulatory process imposes excessive burdens and costs on the economic system and iii many of government s fiscal and monetary policies tend to distort economic incentives and lower the productivity of the system at the other extreme one can identify some points of view that assign to the government a critical role in the process of economic development and could argue that a larger government size is likely to be a more powerful engine of economic development there are several arguments on which the latter point of view is based these include besides others i role of the government in harmonizing conflicts between private and social interests ii prevention of exploitation of the country by foreigners and iii securing an increase in productive investment and providing a socially optimal direction for growth and development

remitting behaviour of turkish migrants evidence from household data in germany this paper provides an empirical analysis of the remittances of turkish migrants using novel data from 589 households in berlin which holds the largest turkish community outside turkey the findings suggest that the remittances of turkish migrants are determined mainly by a combination of self interest and tempered altruism comparison of migrant groups who do and do not intend to return to turkey shows that those intending to return remit mostly for self interest and remit larger amounts while those with no such intention remit mainly due to implicit loan agreement within the family there is no evidence of pure altruism in any of the samples in addition remitters are more likely to increase the amount of remittances where they are to be spent on education and investment the same relationship does not hold for basic needs

research and development expenditures and economic growth a cross country study an assessment of the sources of economic growth is of obvious importance and numerous attempts have been made to judge the impact of different factors on economic growth although these exercises have been typically conducted in the context of development problems of less developed countries ldcs the issues studied are fairly general the list of items whose possible effect on economic growth has been assessed is long however as far as we know there is no work that explores even in a preliminary manner the effect of research and development r d outlays on economic growth in a large crosscountry setting 2 since technological change is probably one of the most important factors in economic growth this study makes a small beginning toward an assessment of the effect of r d outlays on economic growth in an international setting although there are wellknown data problems and methodological issues the effort seems worthwhile 3 our work has been facilitated by the national science foundation s nsf compilation of reasonably good data on r d outlays for a fairly large cross section of countries 4

long term effects of temporary income shocks on food consumption and subjective well being abstracta national level unconditional cash transfer programme bantuan langsung tunai blt in indonesia allows an empirical assessment on whether there are long term benefits in terms of food consumption and overall well being the results show that a positive albeit temporary income shock increases the quantity of food consumed by the poorest households and the overall subjective well being among the poorest recipients it is also found that poor households are more likely to invest in farm and non farm businesses which in turn helps them sustain a higher level of food consumption and overall satisfaction months after the end of the programme

earmarking and partitioning increasing saving by low income households abstract this research examines the effects of earmarking money on savings by low income consumers in particular the authors test two interventions that are designed to enhance the effects of earmarking 1 using a visual reminder of the savings goal and 2 dividing the earmarked money into two parts consistent with prior research suggesting that partitioning increases self control people save more when earmarked money is partitioned into two accounts than when it is pooled into one account in addition the presence of the visual reminder increases the savings rate the authors conclude with implications for consumer welfare and directions for further research

goals and bracketing under mental accounting abstract behavioral economics struggles to explain why people sometimes evaluate outcomes separately narrow bracketing of mental accounts and sometimes jointly broad bracketing we develop a theory of endogenous bracketing where people set goals to tackle self control problems goals induce reference points that make substandard performance painful evaluating goals in a broadly bracketed mental account insulates an individual from exogenous risk of failure but because decisions or risks in different tasks become substitutes there are incentives to deviate from goals that are absent under narrow bracketing extensions include goal revision naivete about self control income targeting and firms bundling strategies

remittances labour supply and activity of household members left behind abstractthis paper analyses the role of remittances on labour supply and activity of household members left behind by explicitly distinguishing between different types of self employment contrary to the existing evidence we find no dependency effect of remittances our results show that remittances received by households in tajikistan decrease the probability of wage employment and increase that of small scale self employment activities of men staying behind without affecting the number of job specific hours worked any positive effect on economic development would be however limited as self employment is in rather small scale activities that do not generate a regular income stream

saving in developing countries theory and review in the literature on economic development much of the interest in saving has been focused on the relation between saving and growth but saving is not only about accumulation it is about smoothing consumption in the face of volatile and unpredictable income and helping to ensure the living standards of poor people whose lives are difficult and uncertain this paper develops a model of households which cannot borrow but which accumulate assets as a buffer stock to protect consumption when incomes are low such households dissave as often as they save do not accumulate assets over the long term and have on average very small asset holdings but their consumption is markedly smoother than their income much of the evidence is as consistent with this view of saving as it is incosistent with standard views of smoothing over the life cycle and with explanations of the link between saving and growth in terms of life cycle saving behavior consumption smoothing is also a useful way of thinking about government policy where volatility in the world prices of taxed commodities can generate sharp fluctuations in government revenues as well as reallocations of revenue between the private and public sectors many important policy issues in developing countries hinge on issues of consumption and smoothing and research on these issues is currently likely to be more productive than work on the relation between saving and growth

migrant remittances and physical investment purchases evidence from kenyan households this paper investigates the impact of remittances on household decisions to purchase physical investments in kenya using household survey data an instrumental variables approach is employed using rainfall variation and mobile network coverage as instruments to control for the endogeneity of remittances the empirical evidence obtained is suggestive of remittances having a positive and significant effect on the decisions by households to purchase physical investments

the effects of external migration on enrolments accumulated schooling and dropouts in punjab external migration in developing countries can relax household income constraints because of external remittances this paper looks at whether the external migration of individuals in a household has a positive effect on schooling outcomes of children as measured by school enrolments accumulated level of schooling number of days spent in school and dropouts in punjab historic migration rates were used to instrument for migration in an analysis of school outcomes for children of different ages to see which group has been most affected by external migration the results show a significantly positive impact of external migration on the enrolments of younger children whereas the accumulated level of schooling for older children increases significantly if there is an external migrant in the household

the benefits of emergency reserves greater preference and persistence for goals that have slack with a cost abstractmarketers of programs that are designed to help consumers reach goals face dual challenges of making the program attractive enough to encourage consumer signup while still motivating consumers to reach desirable goals and thus stay satisfied with the program the authors offer a possible solution to this challenge the emergency reserve or slack with a cost they demonstrate how an explicitly defined emergency reserve not only is preferred over other options for goal related programs but can also lead to increased persistence study 1 demonstrates that consumers prefer programs with emergency reserves to programs that do not have them and study 2 further clarifies that consumers preference for an emergency reserve depends on the presence of a superordinate goal study 3 reveals that consumers prefer goals with emergency reserves because they perceive them to have both higher attainability and value than other goals study 4 demonstrates that reserves can lead to increased goal persistence in a

labor supply of new york city cabdrivers one day at a time life cycle models of labor supply predict a positive relationship between hours supplied and transitory changes in wages because such changes have virtually no effect on life cycle wealth previous attempts to test this hypothesis empirically with time series data have not been supportive estimated elasticities are typically negative or nonsignificant such analyses however are vulnerable to measurement error and other estimation problems we use data on daily observations of wages and hours for new york city cab drivers to estimate the supply response to transitory fluctuations in wages cab drivers decide daily how many hours to supply and face wages that are positively correlated within days but largely uncorrelated between days using these data our central finding is that wage elasticities are persistently negative from 5 to 1 in three different samples even after correcting for measurement error using instrumental variables these negative wage elasticities challenge the notion that cab drivers trade off labor and leisure at different points in time and question the empirical adequacy of life cycle formulations of labor supply

microeconomic implications of remittances in an overlapping generations model with altruism and a motive to receive inheritance abstract the article develops a framework to examine the interaction between the migrant and the remittance receiving relative s under non cooperative and cooperative scenarios the model has an overlapping generations structure where both parties have altruistic behavioural traits we derive the relationships between the remittances consumption labour supply savings and bequests and compare these variables under the two scenarios for both scenarios the remittances have a positive effect on the relative s leisure consumption and investment the effects of the wage and the non wage income of the relative and the migrant and the interest rate on the equilibrium level of remittances are also qualitatively similar under the two scenarios however the parties degrees of altruism as well as the discount rates have different effects on the equilibrium level and incidence of remittances for the non cooperative and cooperative interactions these shed some light on the differences in remittance behavi

remittances and the brain drain this trend is raising considerable concern among policymakers in developing countries wary of having to bear the cost of educating and then losing their most entrepreneurial and talented workers the possibility for educated migrants to move abroad should raise the returns to education and in the end may even lead to an increase in the number of educated workers who stay at home bhagwati and hamada 1974 bhagwati 1976 mountford 1997 stark helmenstein and prskawetz 1997 1998 the european community household panel is a closed panel and therefore cannot easily be used to study return migration the key finding table 1 column 3 is that more educated immigrants from non eu countries are less likely to drop out of the panel even after controlling for age gender employment status and length of stay in the host country the pattern of attrition in the european community household panel sample dependent variable probability that respondent does not drop out of the panel variable household siz

remittance receipt and business ownership in the dominican republic using household level data from the dominican communities in the latin american migration project lamp dr7 we examine the links between remittance receipt and business ownership we find that while the existence of a family business attracts remittance inflows these monetary funds are associated with a reduced likelihood of business entrepreneurship these results are consistent with various hypotheses regarding remittances and business investments first remittances may be motivated by the availability of investment opportunities in the home community second remittances may respond to a bequest motive on the part of the emigrant who may wish to lay claim on family assets when returning home lastly remittances may cause an income effect that reduces family labour force participation and correspondingly the likelihood of family run business investments

remittances and the brain drain do more skilled migrants remit more in most destination countries immigration policies are tilted more and more in favor of skilled individuals whether this shift hurts economic prospects in sending countries as argued by the traditional brain drain literature is somewhat controversial the most recent literature focuses on the link between skilled outmigration and educational achievements in the home country this article emphasizes a different channel it considers the argument that skilled migrants raise economic welfare at home by sending a relatively larger flow of remittances while skilled migrants typically earn more and so might be expected to remit more they are also likely to spend more time abroad and to reunite with their close family in the host country these second two factors should be associated with a smaller propensity to remit thus the sign of the impact of the brain drain on total remittances is an empirical question a simple model has been developed showing that skilled migrants may indeed have a lower propensity to remit from a given flow of earnings an empirical equation of remittances is estimated as a measure of the brain drain in developing countries using the docquier and marfouk 2004 data set evidence is found that the brain drain is associated with a smaller propensity to remit

remittances household expenditure and investment in guatemala the author uses a large household data set from guatemala to analyze how the receipt of internal remittances from guatemala and international remittances from the united states affects the marginal spending behavior of households on various consumption and investment goods contrary to other studies the author finds that households receiving remittances actually spend less at the margin on consumption food and consumer goods and durables than do households receiving no remittances instead of spending on consumption households receiving remittances tend to spend more on investment goods like education health and housing the analysis shows that a large amount of remittance money goes into education at the margin households receiving internal and international remittances spend 45 and 58 percent more respectively on education than do households with no remittances these increased expenditures on education represent investment in human capital like other studies the author finds that remittance receiving households spend more at the margin on housing these increased expenditures on housing represent a type of investment for the migrant as well as a means for boosting local economic development by creating new income and employment opportunities for skilled and unskilled workers