Publication: The Impact of Remittances on Poverty and Inequality in Ghana
Date
2008-09
ISSN
Published
2008-09
Author(s)
Adams, Richard H., Jr.
Cuecuecha, Alfredo
Page, John
Abstract
This paper uses a new, 2005/06
nationally-representative household survey to analyze the
impact of internal remittances (from Ghana) and
international remittances (from African and other countries)
on poverty and inequality in Ghana. To control for selection
and endogeneity, it uses a two-stage multinomial logit model
with instrumental variables focusing on variations in
migration networks and remittances among various
ethno-religious groups in Ghana. The paper finds that both
internal and international remittances reduce the level,
depth, and severity of poverty in Ghana. However, the size
of the poverty reduction depends on the type of remittances
received. In general, poverty in Ghana is reduced more by
international than internal remittances. For households
receiving international remittances, the level of poverty
falls by 88.1 percent with the inclusion of remittances; for
households receiving internal remittances, poverty falls by
69.4 percent with the inclusion of remittances. The paper
also finds that both types of remittances increase income
inequality in Ghana. For households with internal
remittances, the inclusion of remittances causes the Gini
coefficient to rise by 4 percent, and for households with
international remittances, the inclusion of remittances
causes the Gini to increase by 17.4 percent.
Citation
“Adams, Richard H., Jr.; Cuecuecha, Alfredo; Page, John. 2008. The Impact of Remittances on Poverty and Inequality in Ghana. Policy Research Working Paper; No. 4732. © World Bank, Washington, DC. http://openknowledge.worldbank.org/entities/publication/a5371c2c-717e-595c-ae82-98914ec9fc05 License: CC BY 3.0 IGO.”
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