The Value of Remittances: Effects of Labor Migration on Family Income in Tajikistan

Erin T. Hofmann, University of Texas at Austin
Cynthia Buckley, University of Texas at Austin

This poster examines the effect of migrant remittances on perceptions of household economic security and consumption patterns in Tajikistan, a country widely noted for its reliance upon remittances. Unofficial estimates place remittances at 50 to 60% of gross domestic product, but the potential for harnessing these funds for development remains unclear. Using World Bank surveys from 2003 and 2005 and LSMS data from 1999 and 2002, we compare households reporting remittance income to those without it. Among households receiving remittances, we find higher perceptions of stability and somewhat higher levels of basic food consumption, but no increase in durable goods purchasing or in entrepreneurial activity, saving or investment, once regional and compositional factors are controlled for. Among households with recently returned migrants, the effects are similar, but weaker. Our findings highlight the importance of migration for families in Tajikistan and question the role of remittances in supporting household-level development behaviors.