Remittances and Expenditure Patterns of the Left Behinds in Rural China

36 Pages Posted: 18 Jan 2016

See all articles by Sylvie Démurger

Sylvie Démurger

University of Lyon 2 - Groupe d'Analyse et de Théorie Economique (GATE)

Xiaoqian Wang

University of Saint Etienne - Analysis Group and Economic Theory Lyon St-Etienne (GATE-LSE)

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Abstract

This paper investigates how private transfers from internal migration in China affect the expenditure behaviour of families left behind in rural areas. Using data from the Rural-Urban Migration in China (RUMiC) survey, we assess the impact of remittances sent to rural households on consumption-type and investment-type expenditures. We apply propensity score matching to account for the selection of households into receiving remittances, and estimate average treatment effects on the treated. We find that remittances supplement income in rural China and lead to increased consumption rather than increased investment. Moreover, we find evidence of a strong negative impact on education expenditures, which could be detrimental to sustaining investment in human capital in poor rural areas in China.

Keywords: remittances, labour migration, expenditure behaviour, left-behind, China, propensity score matching

JEL Classification: O15, J22, R23, D13, O53

Suggested Citation

Démurger, Sylvie and Wang, Xiaoqian, Remittances and Expenditure Patterns of the Left Behinds in Rural China. IZA Discussion Paper No. 9640, Available at SSRN: https://ssrn.com/abstract=2716581

Sylvie Démurger (Contact Author)

University of Lyon 2 - Groupe d'Analyse et de Théorie Economique (GATE) ( email )

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Ecully, 69130
France
(33 4) 72 86 61 05 (Phone)
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HOME PAGE: http://www.gate.cnrs.fr/spip.php?article22

Xiaoqian Wang

University of Saint Etienne - Analysis Group and Economic Theory Lyon St-Etienne (GATE-LSE) ( email )

Lyon
France

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