Academic journal article The European Journal of Comparative Economics

Migration, Remittances and Educational Levels of Household Members Left Behind: Evidence from Rural Morocco *

Academic journal article The European Journal of Comparative Economics

Migration, Remittances and Educational Levels of Household Members Left Behind: Evidence from Rural Morocco *

Article excerpt

1. Introduction

Remittances have seen a considerable increase in recent years. For many developing countries, remittance inflows exceed the value of foreign direct investment and the amount of official development aid. These financial flows, needless to say, have already and will continue to have, profound effect on migrants' countries of origin. At the macro level, remittances seem to be more stable than other forms of external finance, and they also tend to be countercyclical, increasing during economic downturns (World Bank, 2012; Chami et al., 2005). Another important aspect of remittances is their impact on economic growth (Driffield and Jones, 2013; Benmamoun and Lehnert, 2013). At the micro level, it appears that migrants' remittances improve human welfare. For example, several studies have shown the beneficial effects of remittances on transient poverty reduction (Acosta et al., 2007; Esquivel and Huerta-Pineda, 2006). They can also affect the long term welfare of recipients by affecting human capital formation. There is empirical evidence for concluding that in some contexts international remittances have a positive impact on education and child labor reduction, thereby increasing the demand for child schooling (Mansuri, 2006; Acosta, 2006; Yang, 2008; Lopez Cordovas, 2006). This is particularly true for recipient households who are from disadvantaged groups.

While international remittances can apparently help to increase educational attainment of children in receiving households by lifting liquidity constraints, migration of a family member may, however, have a deleterious impact on children' educational success in a given local area. For example, by implying that unskilled work can be an important source of wealth whereby additional income from remittances can be earned independently of schooling, migration may become a source of disruption in households. Further, the division of household labour will be done at the expense of the non-migrant members so reducing the time allotted to their education. Other potential negative influence of migration is that it may increase the likelihood that family members migrate in the future and reduces the desired schooling and, hence, decreases the educational attainment. Furthermore, migrants invest less in education of their own children if the return of education is low in their host countries (as noted by McKenzie and Rapoport (2011), this is the case of Mexican migrants living in United States). In sum, emigration may increase or decrease household investments in children's schooling, depending on whether the income effects from remittances offset the effects of household disruptions.

Remittance flows to Morocco, which originate primarily from France, have increased remarkably over time. According to World Bank data, during the period 2001-2011 the amount of international remittances increased from 2.8 to 7.2 billions US$. Together with tourism, migrants' remittances represent the country's major source of foreign currency receipts. At over 6.5 billion US$ in 2012, they placed Morocco as the 15th largest recipient of remittances in developing countries. In the case of this recipient country, migrants' remittances are an important resource that can be a means to promote its development. However, beyond their quantitative importance, the possible impact of these remittances should be viewed in terms of their use. In this respect, the African Development Bank report (2007) found that in Morocco the priority is given to household consumption (essential goods and services), health and education. Unfortunately, empirical studies have not documented any significant work on the intra-family benefits of remittances to Morocco. For example, there is no evidence that international remittances can increase the educational attainment of children and of adults. This relation between remittance receipts and child education is of particular interest due to the constraints faced by families with respect to educational decisions. …

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