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Impact of remittances on male and female labor force participation patterns in Africa: Quasi‐experimental evidence from Ghana

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  • Edward Asiedu
  • Nurokinan Chimbar
Abstract
In this paper, we examine how remittances, an outcome of labor mobility, affect labor market activities in Ghana using detailed household and individual‐level data. This is important, considering the extensive literature that has documented the remittance–poverty reduction nexus. First, we find a strong negative association between household remittance‐receiving status and individual labor supply decisions using instrumental variable estimation techniques. Second, we find the depressing effect of remittances on labor supply decisions to be much stronger in rural areas. Rural women who reside in remittance‐receiving households are less likely to be in the labor force compared with those who do not reside in such households. Remittances have very little impact on labor supply decisions in urban areas. Our findings support that remittances can exacerbate long‐term poverty reduction in rural areas through lower labor force participation, and as such rural‐based and gender‐based interventions may be needed to help redirect remittance income.

Suggested Citation

  • Edward Asiedu & Nurokinan Chimbar, 2020. "Impact of remittances on male and female labor force participation patterns in Africa: Quasi‐experimental evidence from Ghana," Review of Development Economics, Wiley Blackwell, vol. 24(3), pages 1009-1026, August.
    • Handle: RePEc:bla:rdevec:v:24:y:2020:i:3:p:1009-1026
    DOI: 10.1111/rode.12668
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    References listed on IDEAS

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    2. Musakwa, Mercy T, 2023. "The dynamic causal relationship between remittances, fertility and unemployment in South Africa," Working Papers 31198, University of South Africa, Department of Economics.
    3. Bettin, Giulia & Massidda, Carla & Piras, Romano, 2024. "The intertwined role of social and financial remittances in new firms' creation," Journal of International Management, Elsevier, vol. 30(1).
    4. Yang, Wei & Vatsa, Puneet & Ma, Wanglin & Zheng, Hongyun, 2023. "Does mobile payment adoption really increase online shopping expenditure in China: A gender-differential analysis," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 99-110.
    5. Ofori, Pamela E. & Ofori, Isaac K. & Castelnovo, Paolo, 2024. "Effects of Innovation and Economic Freedom on Female Economic Inclusion," MPRA Paper 121244, University Library of Munich, Germany.
    6. Ofori, Pamela E. & Ofori, Isaac K. & Castelnovo, Paolo, 2024. "Effects of Innovation and Economic Freedom on Female Economic Inclusion," EconStor Preprints 298786, ZBW - Leibniz Information Centre for Economics.
    7. Arian Tahiri & Faruk Ahmeti & Burim Prenaj, 2023. "The Effect of International Migrant Remittances on Employment Patterns: Evidence from Kosovo," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 126-142.

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