Garbage In, Gospel Out? Controlling for the Underreporting of Remittances

Author/Editor: Shonkwiler, J. Scott ; Grigorian, David A. ; Melkonyan, Tigran A.
Publication Date: September 01, 2008
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary: Empirical studies that use self-reported data on remittances to measure the latter's impact on microeconomic incentives mostly ignore the potential errors associated with reporting/measurement issues. An econometric procedure to control for these errors is developed and applied to household-level data from Armenia. We find evidence of systematic under-reporting of remittances. After controlling for this, we find a strong negative impact of remittances on incentives to work.
Series: Working Paper No. 08/230
Subject(s): Workers remittances | Armenia | Data collection | Financial incentives | Labor supply | Economic models

Author's Keyword(s): censored data | measurement error | labor supply | Armenia
Publication Date: September 01, 2008
Format: Paper
Stock No: WPIEA2008230 Pages: 19
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