Should I stay or leave? The effect of remittances in the sub-Saharan region

Figures & data

Table 1. General statistics.

Statistic	N	Mean	St. Dev	Min	Pctl(25)	Pctl(75)	Max
RIM	417	5.296	1.760	−1.586	4.156	6.366	10.098
FDI	456	5.641	1.903	−2.893	4.657	6.903	9.213
GDP	463	7.199	0.950	5.599	6.453	7.750	9.726
CORR	480	−0.659	0.662	−1.784	−1.177	−0.258	1.211
EDU	327	71.949	17.894	21.473	59.953	86.348	112.646
EDUFEMALE	320	70.909	19.968	19.293	55.988	88.132	112.776
EDUMALE	320	72.722	16.227	35.424	60.929	85.120	115.129
HEALTH	463	37.481	20.204	2.993	21.804	53.126	80.461
REFUGEE	478	8.377	3.172	1.609	5.726	10.596	14.707
POOR	480	0.533	0.499	0	0	1	1

Table 2. Variable definitions.

Variable	Symbol	Variable treatment
Personal remittances	RIM	Personal remittances received in current US dollars
Foreign direct investment	FDI	Foreign direct investment, net inflows, current US dollars
Corruption control index	CORR	Corruption control index from World Bank database
GDP per capita	GDP	GDP per capita, constant 2015 dollars
Primary school finish rate	EDU	Primary school finish rate
Primary school finish rate for males	EDUMALE	Primary school finish rate for males
Primary school finish rate for females	EDUFEMALE	Primary school finish rate for females
Out-of-pocket expenditures on health	HEALTH	The out-of-pocket expenditures as a percentage of current health expenditures
Number of refugees	REFUGEE	The number of people entering other countries as refugees
Dummy variable	POOR	If the country’s per capita GDP is lower than average, POOR = 1, otherwise it is 0

Table 3. Remittances and refugee travel budget.

	Dependent variable:
	RIM
	(1)	(2)	(3)
REFUGEE	0.239***	0.233***	0.233***
	(0.031)	(0.031)	(0.031)
CORR	−0.998**	−0.956**	−0.940**
	(0.425)	(0.430)	(0.436)
FDI	0.143**	0.140**	0.139**
	(0.067)	(0.068)	(0.068)
CORR*FDI	0.169**	0.159**	0.158**
	(0.071)	(0.072)	(0.072)
POOR			0.038
			(0.161)
Constant	2.616***	2.405***	2.388***
	(0.440)	(0.487)	(0.494)
Year control	N	Y	Y
Observations	394	394	394
R^2	0.207	0.215	0.215
Adjusted R^2	0.199	0.188	0.186
Residual Std. Error	1.513 (df = 389)	1.523 (df = 380)	1.525 (df = 379)
F Statistic	25.398*** (df = 4; 389)	7.993*** (df = 13; 380)	7.408*** (df = 14; 379)

Note: *, ** and *** denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 4. Remittances and GDP.

	Dependent variable:
	GDP
	(1)	(2)	(3)
RIM	−0.059**	−0.063**	−0.059***
	(0.024)	(0.025)	(0.014)
CORR	0.643***	0.657***	−0.029
	(0.222)	(0.225)	(0.133)
FDI	0.082**	0.082**	0.100***
	(0.035)	(0.035)	(0.020)
CORR*FDI	0.008	0.006	0.078***
	(0.037)	(0.037)	(0.022)
POOR			−1.325***
			(0.049)
Constant	7.418***	7.344***	7.902***
	(0.226)	(0.250)	(0.146)
Year control	N	Y	Y
Observations	390	390	390
R^2	0.296	0.301	0.766
Adjusted R^2	0.289	0.277	0.757
Residual Std. Error	0.773 (df = 385)	0.779 (df = 376)	0.451 (df = 375)
F Statistic	40.485*** (df = 4; 385)	12.459*** (df = 13; 376)	87.665*** (df = 14; 375)

Note: ***, ** and * denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 5. Remittances and education.

	Dependent variable:
	EDU
	(1)	(2)	(3)
RIM	−1.261**	−1.368**	−0.756
	(0.558)	(0.572)	(0.479)
CORR	−2.229	−2.165	−7.231**
	(4.245)	(4.314)	(3.620)
FDI	0.650	0.638	0.897*
	(0.626)	(0.638)	(0.532)
CORR*FDI	2.869***	2.821***	3.130***
	(0.703)	(0.716)	(0.596)
POOR			−15.733***
			(1.439)
Constant	83.991***	83.141***	87.897***
	(4.437)	(4.883)	(4.087)
Year control	N	Y	Y
Observations	281	281	281
R^2	0.385	0.395	0.583
Adjusted R^2	0.376	0.366	0.561
Residual Std. Error	13.198 (df = 276)	13.307 (df = 267)	11.074 (df = 266)
F Statistic	43.186*** (df = 4; 276)	13.418*** (df = 13; 267)	26.526*** (df = 14; 266)

Note: ***, ** and * denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 6. Remittances and health.

	Dependent variable:
	HEALTH
	(1)	(2)	(3)
RIM	1.794***	1.895***	1.898***
	(0.540)	(0.549)	(0.550)
CORR	−3.461	−3.917	−4.170
	(4.922)	(4.981)	(5.048)
FDI	0.386	0.423	0.428
	(0.766)	(0.776)	(0.777)
CORR*FDI	−1.741**	−1.654**	−1.628*
	(0.819)	(0.829)	(0.834)
POOR			−0.590
			(1.828)
Constant	16.157***	18.346***	18.609***
	(5.004)	(5.528)	(5.595)
Year control	N	Y	Y
Observations	389	389	389
R^2	0.278	0.283	0.283
Adjusted R^2	0.271	0.258	0.257
Residual Std. Error	17.033 (df = 384)	17.179 (df = 375)	17.199 (df = 374)
F Statistic	37.052*** (df = 4; 384)	11.400*** (df = 13; 375)	10.568*** (df = 14; 374)

Note: ***, ** and * denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 7. 2SLS refugees as the instrumental variable for GDP and health.

	Dependent variable:
	RIM	GDP	HEALTH
	OLS	Instrumental	Instrumental
		variable	variable
	(1)	(2)	(3)
REFUGEE	0.233***	−0.197***	6.084***
	(0.031)	(0.043)	(1.575)
CORR	−0.940**	−0.234	2.136
	(0.436)	(0.160)	(5.854)
FDI	0.139**	0.122***	−0.227
	(0.068)	(0.024)	(0.866)
CORR*FDI	0.158**	0.097***	−2.234**
	(0.072)	(0.025)	(0.920)
POOR	0.038	−1.320***	−0.839
	(0.161)	(0.054)	(1.966)
	(0.494)
Constant	0.233***	8.415***	3.111
	(0.031)	(0.222)	(8.086)
Year control	Y	Y	Y
Observations	394	390	389
R^2	0.432	0.707	0.172
Adjusted R^2	0.411	0.696	0.141
Residual Std. Error	2.354 (df = 379)	0.505 (df = 375)	18.484 (df = 374)
F Statistic	20.582*** (df = 14; 379)

Note: ***, ** and * denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 8. 2SLS refugees as instrumental variables in education.

	Dependent variable:
	RIM	EDU	EDUFEMALE	EDUMALE
	OLS	Instrumental	Instrumental	Instrumental
		variable	variable	variable
	(1)	(2)	(3)	(4)
REFUGEE	0.233***	−6.960***	−6.852***	−6.162***
	(0.031)	(2.147)	(2.271)	(2.001)
CORR	−0.940**	−16.504***	−16.616***	−17.904***
	(0.436)	(5.552)	(5.887)	(5.187)
FDI	0.139**	1.455**	1.763**	1.144*
	(0.068)	(0.704)	(0.752)	(0.662)
CORR*FDI	0.158**	4.102***	4.512***	3.920***
	(0.072)	(0.827)	(0.880)	(0.776)
POOR	0.038	−13.557***	−13.109***	−14.506***
	(0.161)	(1.974)	(2.077)	(1.830)
Constant	2.388***	111.732***	108.720***	110.646***
	(0.494)	(9.473)	(10.222)	(9.007)
Year control	Y	Y	Y	Y
Observations	394	281	274	274
R^2	0.432	0.320	0.357	0.317
Adjusted R^2	0.411	0.284	0.322	0.280
Residual Std. Error	2.354 (df = 379)	14.139 (df = 266)	14.956 (df = 259)	13.178 (df = 259)
F Statistic	20.582*** (df = 14; 379)

Note: ***, ** and * denote the statistical significance at the 1%, 5% and 10% levels; standard errors are shown in parentheses.

Table 9. Summary of findings.

Hypotheses	Validation
H1. Higher number of refugees is associated with higher remittance.	Supported
H2. Higher remittances decrease the GDP in harsh socioeconomic environments.	Supported
H3. Higher remittances increase the primary school dropout rate in harsh socioeconomic environments.	Supported
H4. Higher remittances increase health expenditures and healthcare affordability	Supported

Data availability statement

The data that support the findings of this study are openly available in World Bank’s World Development Indicators database at https://databank.worldbank.org/source/world-development-indicators.