This paper estimates the effect of international remittances on healthcare expenditures, taking into account both the interdependence with other consumption goods and the effects of health shocks. More precisely, we assess whether the budget allocation decisions of remittance-receiving households reveal different preferences to invest in health capital, even when the simultaneous effect that health shocks may have on the demand of remittances and on other types of nondurable expenditures is accounted for. Using data from the “Peruvian National Survey of Households,” we find that remittances have a positive impact on healthcare budget shares, net of the remittance-related income effect and independently of the occurrance of a health shock. They also have a positive impact on housing and a negative one on other expenditure items, that is, clothing, transport, and education. Hence, our results indicate a “pure” tendency of remittance-receiving households to devote larger shares of their budget to health capital investment, rather than to other types of consumption goods.

Berloffa, G., Giunti, S. (2019). Remittances and healthcare expenditure: Human capital investment or responses to shocks? Evidence from Peru. REVIEW OF DEVELOPMENT ECONOMICS, 23(4), 1540-1561 [10.1111/rode.12599].

Remittances and healthcare expenditure: Human capital investment or responses to shocks? Evidence from Peru

Giunti S.
Co-primo
2019

Abstract

This paper estimates the effect of international remittances on healthcare expenditures, taking into account both the interdependence with other consumption goods and the effects of health shocks. More precisely, we assess whether the budget allocation decisions of remittance-receiving households reveal different preferences to invest in health capital, even when the simultaneous effect that health shocks may have on the demand of remittances and on other types of nondurable expenditures is accounted for. Using data from the “Peruvian National Survey of Households,” we find that remittances have a positive impact on healthcare budget shares, net of the remittance-related income effect and independently of the occurrance of a health shock. They also have a positive impact on housing and a negative one on other expenditure items, that is, clothing, transport, and education. Hence, our results indicate a “pure” tendency of remittance-receiving households to devote larger shares of their budget to health capital investment, rather than to other types of consumption goods.
Articolo in rivista - Articolo scientifico
demand system; health; Peru; remittances; shock response
English
1540
1561
22
Berloffa, G., Giunti, S. (2019). Remittances and healthcare expenditure: Human capital investment or responses to shocks? Evidence from Peru. REVIEW OF DEVELOPMENT ECONOMICS, 23(4), 1540-1561 [10.1111/rode.12599].
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10281/286784
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