The Determinants of Migrant Remittance Behavior: A Thai Case Study
Keywords:
Migration, Remittances, ThailandAbstract
Migrant remittances often serve as a major source of income and insurance for the receiving households. This paper uses the 2013 Socioeconomic Survey (SES) and historical annual rainfall data at the provincial level to examine the determinants of remittance behavior in Thailand, and test for the existence of four possible motives: altruism, exchange, insurance, and investment. Heckman’s (1979) two-step procedure is applied to estimate decisions to remit and the amount of remittances, accounting for selection bias. The results indicate that remittances are a part of implicit contract arrangements between migrants and household members. Regression results support a combination of four motives explaining migration and remittance behavior in Thailand. Major findings are: (1) Migrants from agricultural households or households with multiple migrants behave altruistically towards family members in origin households; (2) The amounts of remittances received increase with household income and assets, suggesting the importance of investment motives; and (3) Positive rainfall shocks decrease the propensity to migrate, but have no significant effect on the amounts remitted.
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