2015年-世界发展银行全球_Asymmetric_Information_about_Migrant_Earnings_and_Remittance_Flows_43页_933kb

Summary of "Asymmetric Information about Migrant Earnings and Remittance Flows"

Core Content

This paper investigates the role of asymmetric information in shaping remittance behavior in transnational households, focusing on Indian migrant families with husbands working in Qatar. The key insight is that when migrant earnings are private information, the recipient (typically the wife) may underreport these earnings, which in turn affects the amount of remittances sent home.

Main Findings

• Asymmetric Information: Wives underreport their husbands' earnings, with the underreporting being more pronounced in households where the husband earns more.
• Reported Earnings Ratio: On average, wives report only 79% of their husbands' earnings, indicating a significant information asymmetry.
• Remittance Behavior: The discrepancy in earnings reports is strongly correlated with remittance levels. Lower reported earnings ratios are associated with lower remittances.
• Empirical Evidence: The study uses a matched dataset of 108 migrant husbands in Qatar and their wives in Kerala, India, and finds that the reported earnings ratio decreases with higher income, and that remittance behavior is steeper at lower income levels.

Key Predictions from the Model

• Prediction 1: The reported earnings ratio decreases with positive income shocks.
• Prediction 2: The reported earnings ratio is lower when there is more information asymmetry or when the recipient holds more pessimistic beliefs about the migrant's earnings.
• Prediction 3: The lower the reported earnings ratio, the lower the remittances, and vice versa.
• Prediction 4: The remittance schedule is steeper at lower levels of income.

Theoretical Model

The paper develops a model based on the exchange motive for remittances (Cox 1987, Cox et al. 1998), incorporating asymmetric information and costly state verification. The model suggests that the recipient sets a remittance threshold $\bar{r}$, and the migrant is only required to remit truthfully if his income is below this threshold. If the migrant's income is above the threshold, he can choose to underreport or not report it, as this avoids future scrutiny or sanctions.

• Optimal Contract: The optimal remittance contract is characterized by a threshold remittance level $\bar{r}^*$, which is the minimum amount the migrant must remit to avoid verification.
• Verification Cost: The verification cost $c$ plays a central role in determining the threshold. Higher verification costs lead to lower remittance thresholds.
• Pessimistic Beliefs: If the recipient has more pessimistic beliefs about the migrant's income, the threshold is set lower, reducing the frequency of income revelation.

Methodology and Data

• Data Collection: A matched dataset of 108 migrant husbands in Qatar and their wives in Kerala was used. The data was collected through separate interviews to avoid information leakage between spouses.
• Key Variables: The dataset includes information on migrant earnings, remittances, demographics, expenses, life and work satisfaction, and savings/loan decisions.
• Comparison with Existing Surveys: The study compares its findings with data from the Kerala Migration Survey (KMS) 2011, which provides a representative sample of households in Kerala with migrant members. The results are consistent with the KMS data in terms of average age, duration abroad, and annual earnings.

Implications

• Social and Familial Pressures: The paper highlights that social and familial sanctions play a key role in motivating remittance behavior, especially among temporary migrants.
• Policy Relevance: The findings suggest that remittance contracts are influenced by asymmetric information, and that underreporting of income and remittances can be a strategic response to avoid scrutiny.
• Future Research: The study contributes to the literature on asymmetric information in migration and remittance behavior, offering a new empirical approach by using cross-reports from both migrants and their families.

Conclusion

The paper demonstrates that asymmetric information about migrant earnings significantly affects remittance flows, and presents a theoretical model that aligns with empirical observations. It also provides new evidence of income underreporting in transnational households and emphasizes the role of verification costs and recipient beliefs in shaping remittance contracts. The study contributes to a better understanding of how information asymmetry influences household economic decisions in the context of international migration.