Remittances as a Shield to Vulnerable Households in Macedonia: The Case When the Instrument is Not Strictly Exogenous. (8th September 2016)

• Record Type: Journal Article
• Authors: Petreski, Marjan; Petreski, Blagica; Tumanoska, Despina
• Is Part Of: International migration. Volume 55:Number 1(2017)
• Page Start: 20
• Page End: 36
• Publication Date: 2016-09-08
• Subjects: Emigration and immigration -- Periodicals; 304.8
• DOI: 10.1111/imig.12279
• Languages: English
• ISSNs: 0020-7985

Abstract

Abstract: The objective of this article is to investigate whether remittances sent to Macedonia have a role to play for shielding vulnerable households, by highlighting the importance of a strictly exogenous instrument in an IV context. Results suggest that remittance‐receiving households have, on average, a 20.1 per cent lower vulnerability than non‐receiving ones. However, if one has a reasonable belief that vulnerability and the instrument are determined simultaneously, or are directly correlated due to the existence of a third unobservable factor, then the shielding effect of remittances for vulnerable households remains up to the ninth percentage of direct influence and with a reducing magnitude, and then disappears.