Location of Repository

Motives and Giving Norms behind Remittances: the Case of Filipino Overseas Workers and their Recipient Households

By Michael M. Alba and Jessaine Soraya C. Sugui

Abstract

The literature has focused on motives to explain remittance behavior. But as nonanonymous transfers, remittances are apt to be influenced by giving norms as well. We formulate an empirical specification that takes account of remittance motives involving worker-household pairs. We find that altruism dominates the exchange motive among overseas workers who are likely to be the primary breadwinners of their recipient households. We also find that in the subsample in which overseas workers are likely to be secondary breadwinners, (a) household labor income is an endogenous explanatory variable, and (b) the error covariance of the household income and remittance selection equations is positive. A possible reason for (a) is that secondary breadwinners use household income as an imperfect signal of opportunity cost or to detect unobserved effort, i.e., moral hazard, in generating income. As for (b), we surmise that it indicates the presence of incentive-compatible mechanisms against moral hazard. On giving norms, we find that, in samples that include overseas workers who are secondary breadwinners, remittance amounts are afflicted with negative selectivity. We present evidence that this is consistent with Filipino giving practices in which everyone gives but in modest amounts

Topics: F24, ddc:330, remittances, remittance motives, giving norms, R\ufcck\ufcberweisungen, Soziale Norm, Motivation, Migranten, Philippinen
Publisher: Makati City: Philippine Institute for Development Studies (PIDS)
Year: 2009
OAI identifier: oai:econstor.eu:10419/126789
Provided by: EconStor

Suggested articles

Preview


To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.