Garbage In, Gospel Out? Controlling for the Underreporting of Remittances
IMF Working Papers, September 1, 2008
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- Garbage In, Gospel Out? Controlling for the Underreporting of Remittances
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Bibliographic details
- Authors: Tigran A. Melkonyan, David A. Grigorian, J. Scott Shonkwiler
- Published: September 1, 2008
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451870886.001
Summary
- Authors: Tigran A. Melkonyan, David A. Grigorian, J. Scott Shonkwiler
- Date: September 1, 2008
- Core question: How do reporting/measurement errors in self-reported remittance data affect empirical estimates of remittances' impact on microeconomic incentives?
- Main contribution: Develops an econometric procedure to control for reporting/measurement errors in remittance data and applies it to household-level data from Armenia.
Methodology and Data
- Approach: An econometric procedure to control for reporting/measurement errors in self-reported remittance variables.
- Application: Household-level data from Armenia.
- Emphasis: Accounting for systematic under-reporting in remittances before estimating behavioral effects (in particular, incentives to work).
Key Findings
- Evidence of systematic under-reporting of remittances in self-reported household data.
- After controlling for reporting/measurement errors, the estimated impact of remittances on labor incentives changes materially:
- Finding: A strong negative impact of remittances on incentives to work.
Policy and Analytical Implications
- Empirical analyses using self-reported remittance measures should control for measurement/reporting error before drawing behavioral or policy conclusions.
- Failure to account for under-reporting can bias estimates of remittances' effects on labor supply and related microeconomic incentives.
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