The Effects of International Remittances on Child Schooling in Ecuador

An economic crisis hit Ecuador during the final years of the 20th century. This crisis initiated a massive migration of Ecuadoreans mostly to Europe and the United States. The remittances migrants started sending back rapidly increased and soon represented an important share of the GDP. This became a new source of income (or the only one) for many households. The present research project analyzes, through the use of an instrumented probit model, how the probability of children attending school changes when the household receives remittances and when other variables are accounted for. Data from the 2010 Ecuadorean Housing and Population Census was used to examine this relationship. The results suggest that, mainly, due to the inequality in the distribution of remittances and current consumption patterns, remittances are not having an important positive impact on human capital formation in Ecuador, when measured through the likelihood of school attendance.EconomicsMastersUniversity of New Mexico. Dept. of EconomicsFontenla, MatiasBohara, AlokBinder, Meliss