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The impact of remittances on education attendance: The case of Rural Egypt

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Director
Denomination Maîtrise universitaire en socioéconomie orientation démographie
Defense Maîtrise : Univ. Genève, 2018
Abstract The ongoing debate on the impact of remittances on development has led to different narratives and yet not enough empirical research to support whether remittances effectively impact development. And while the argument on the existence of an impact on economic development is still to be thoroughly examined, available research suggests the existence of an impact on the human development dimensions. Because of its importance as a source of income for many households in Rural Egypt, we choose to focus on the possible impact of remittances on education which represents a cornerstone of any development project. Subsequently, this study examines the impact of remittances on education attendance in Rural Egypt for males and females in the age groups [15-17] and [18-22]. Our analysis is built on the idea that remittances as an extra income can alleviate the budget constraint at the level of the household and enable investment in the human capital of the individuals. We make use of data from Egypt Labour Market Panel Survey (2012) which provides extended information on remittances, migration and education behaviour at the household level. Since reported remittances in the survey may lack in accuracy due to underreporting and the presence of a possible recall bias we only focus on whether households received remittances in the 12 months prior to the survey. For the education outcome, we consider whether the individual is currently enrolled in secondary school or in tertiary education. To inspect the impact of remittances on education attendance we use both a probit and an IV probit model by introducing the history of migration at the level of the household as an instrument to control for the endogenous relation between remittances and the education outcome. We further add a non-parametric test that is the propensity score matching to control for sample selection into remittances. We also introduce two variables to control for household wealth to further limit sample selection into remittances based on the available data relative to the assets and the housing characteristics. To construct the wealth index, we rely on the first principal component method which offers a strong alternative to assess wealth in the absence of information about the prices and dates of purchases of the assets owned by the households. Our findings suggest a positive impact of remittances on education attendance for males, but no evidence is found for females. We further highlight the methodological concerns that rise in the study of remittances and the presence of both endogeneity and sample selection that need to be accounted for. Our findings also suggest that variables related to gender and social norms can determine education outcomes similarly to the presence of a budget constraint.
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ETTARFI, Khaoula. The impact of remittances on education attendance: The case of Rural Egypt. Université de Genève. Maîtrise, 2018. https://archive-ouverte.unige.ch/unige:108545

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Deposited on : 2018-09-26

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