Preliminary Evidence on Internal Migration, Remittances and Teen Schooling in India

Examining correlation between remittances and human capital investment
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This paper uses the 2004–-2005 Human Development Profile of India survey to examine correlations between remittances receipt from internal migrants and human capital investment in rural areas. It uses a propensity score-matching approach to account for household selectivity in receiving remittances. The paper finds a positive correlation between remittances received from internal migrants and teen school attendance. Findings include:

  • Magnitude of the correlation is greater when focusing on low-caste households;
  • Male schooling attendance becomes more positive and statistically significant;
  • Concurrent overall reductions in male adult labor supply, and increases in female adult labor supply were observed.

 ​​The study suggests that there is potential for internal migration in India to improve human capital investment, particularly among the impoverished. Further investigation into what motivates internal migration and remittances and the characteristics of these households can provide insights into the criteria necessary for successful social protection programs in India. The identification of barriers to mobility across states may be relevant for the design of future poverty-reducing policies.

About this Publication

By Mueller, V. & Shariff, A.