Income and remittances

Existing evidence supports the view that migration and remittances increase the income of migrant households and reduce poverty. The impact on income inequality is more contested. However, such findings should be treated with caution as the poverty-reducing impact depends on the country and type of migration flow: remittances are more likely to have a poverty-reducing effect when received by poorer households. In addition, not all migrant-sending households receive remittances. Hence, migration does not always have positive and poverty-reducing impacts on household levels.

To investigate whether migration improves consumption expenditure of migrant-sending households, consumption expenditure for households with and without migrants needs to be compared. Instead of simply comparing households with and without migrants, we developed a counterfactual scenario, which artificially constructs what the consumption expenditure of a household with migrants might have been had the migrant stayed at home; this is then compared this with the observed expenditure.

We have gained considerable expertise in collecting quantitative household data on migration, with household surveys conducted in Bangladesh, Indonesia, Ethiopia, Zimbabwe and Ghana. These surveys of around 1200 households in each country provide useful profiles of migrants, allow us to compare migrant-sending households with the broader population, and draw comparisons across countries. Preliminary results suggest that on average there are net benefits to migration: households with migrants are on average better off than they would have been if their migrant member had stayed at home.