Monday, October 17, 2011

Ecuador and remittances

Juan Ponce, Iliana Olivié, and Mercedes Onofa, "The Role of International Remittances in Health Outcomes in Ecuador: Prevention and Response to Shocks." International Migration Review 45, 3 (Fall 2011): 727-745.


This article evaluates the impact of remittances on health outcomes in Ecuador using an instrumental-variables approach. Although we do not find significant impacts on long-term child health variables, we find that remittances do have an impact on health expenditures, and on some preventive issues such as de-worming and vaccination. In addition, we find significant effects of remittances on medicine expenditures when illness occurs. In this regard, remittances are used for both preventive and emergency situations. Interestingly, we also find a significant and positive effect of remittances on health knowledge.

There is a lot of debate about how remittances are used, and in particular whether they are used primarily for consumption versus starting new businesses or other productive strategies. This article's conclusion is heartening since it suggests that there are positive non-economic outcomes.


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