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Journal of Comparative Economics 43 (2015) 690705

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Journal of Comparative Economics


journal homepage: www.elsevier.com/locate/jce

Transfer behavior in migrant sending communities


Tanika Chakraborty a,b, Bakhrom Mirkasimov c,d, Susan Steiner b,e,
a

Indian Institute of Technology Kanpur, Kanpur, 208016 UP, India


IZA Bonn, Schaumburg-Lippe-Strae 5-9, 53113 Bonn, Germany
Humboldt University of Berlin, Unter den Linden 6, 10099 Berlin, Germany
d
Westminster International University in Tashkent (WIUT), 12 Istiqbol street, 100047 Tashkent, Uzbekistan
e
Leibniz Universitt Hannover, Knigsworther Platz 1, 30167 Hannover, Germany
b
c

a r t i c l e

i n f o

Article history:
Received 12 September 2013
Revised 8 September 2014
Available online 22 September 2014
JEL classication:
F22
I30
O12
Keywords:
Private transfers
Cash and labor exchange
Migration
Kyrgyzstan

a b s t r a c t
Chakraborty, Tanika, Mirkasimov, Bakhrom, and Steiner, SusanTransfer behavior in
migrant sending communities
We study how international migration changes the private transfers made between households in the migrant sending communities of developing countries. A priori, it is indeterminate whether migration and remittances strengthen or weaken the degree of private
transfers in these communities. From a policy perspective, public income redistribution
programs would have an important role to play if migration reduced the extent of private
transfers. Using household survey data from rural Kyrgyzstan, we nd that households
with migrant members (as well as households receiving remittances) are more likely than
households without migrants (without remittances) to provide monetary transfers to others and to receive non-monetary (i.e. unpaid labor) transfers from others. This suggests
that migrant households, through their access to remittance income, insure their social
networks against shocks or redistribute income to poorer households in the community
and receive labor transfers in return. This implies that migration is unlikely to lead to a
weakening of private transfers. Journal of Comparative Economics 43 (3) (2015) 690705.
Indian Institute of Technology Kanpur, Kanpur, 208016 UP, India; IZA Bonn, Schaumburg-Lippe-Strae 5-9, 53113 Bonn, Germany; Humboldt University of Berlin, Unter den
Linden 6, 10099 Berlin, Germany; Westminster International University in Tashkent
(WIUT), 12 Istiqbol street, 100047 Tashkent, Uzbekistan; Leibniz Universitt Hannover,
Knigsworther Platz 1, 30167 Hannover, Germany.
2014 Association for Comparative Economic Studies. Published by Elsevier Inc. All rights
reserved.

1. Introduction
Rural households in developing countries employ a wide range of strategies to deal with the harsh living conditions that
many of them face. Two of these strategies are migration to economically more advantaged places and exchanging informal
private transfers with the households in their social networks.1 In this paper, we study the implications of international migration for private transfer behavior in the migrant sending communities.
Corresponding author at: Institute for Development and Agricultural Economics, Leibniz Universitt Hannover, Knigsworther Platz 1, 30167 Hannover,
Germany. Fax: +49 511 762 2667.
E-mail addresses: tanikac@gmail.com (T. Chakraborty), bmirkasimov@wiut.uz (B. Mirkasimov), steiner@ifgb.uni-hannover.de (S. Steiner).
1
Private transfers function like means-tested income redistribution owing from better off to worse off households. They also act like risk-sharing
mechanisms with income owing to households that experienced income shocks (Cox and Fafchamps, 2008).
http://dx.doi.org/10.1016/j.jce.2014.09.004
0147-5967/ 2014 Association for Comparative Economic Studies. Published by Elsevier Inc. All rights reserved.

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

691

Sending a household member abroad is likely to decrease the households income variability because income is obtained
from various sources. This makes the household less dependent on transfers from other households within the community
(Morten, 2013). If, therefore, migration reduced the extent of private transfers provided within migrant sending communities, this could have serious consequences for those households without migrants abroad. Policy makers should be aware
that private transfers may have to be substituted by public transfers. On the contrary, households that receive remittances
from migrants might transfer more money to other households in the community in order to insure them (Morten, 2013). If,
then, migration increased the extent of private transfers made, this would mean that migration increased the welfare not
only of migrant households but also of non-migrant households.2 The design of migration policies should take this potential
effect into account.
Despite the vast literature on migration on the one hand and private transfers on the other, only few study the connection
between these two aspects. Gallego and Mendola (2013) explore whether migration affects households interactions within
their social networks in Mozambique. They nd that households receiving remittances participate more in groups, such as
rotating savings and credit associations or women and youth groups, and in informal exchanges of goods and services with
others in their community. The authors argue that remittances decrease participation costs in groups and increase commitment in informal mutual arrangements. Morten (2013) develops a dynamic model of risk-sharing with endogenous migration. The model acknowledges that both risk-sharing transfers and migration are mechanisms for households to informally
insure against shocks. Using data from rural India, the author nds that risk-sharing reduces migration but migration also
reduces risk-sharing.
In this paper, we investigate whether international migration weakens or strengthens the extent of private transfers
made within migrant sending communities. Specically, we compare the transfer behavior of households that have migrants
abroad with that of households that do not have migrants abroad. Our focus is not only on risk-sharing transfers or, in other
words, on transfers made in response to shocks as in Morten (2013). The transfers that we observe in our data are transfers
made either in times of shocks or otherwise. The main contribution that we make to the literature is that, in contrast to the
earlier studies, we distinguish between monetary and non-monetary (i.e. unpaid labor) private transfers. Gallego and
Mendola (2013) summarize any transfers made in the form of money, gifts and services, while Morten (2013) only takes
monetary transfers into account. We argue that a distinction between monetary and non-monetary transfers is, however,
important to allow for the possibility that migrant and non-migrant households provide different forms of help to others.
For example, it is possible that some households (potentially those that receive remittances) provide monetary transfers
and other households (potentially those that do not have migrants abroad) return non-monetary help. Such behavior could
not be identied by either ignoring non-monetary transfers or pooling monetary and non-monetary transfers together.3
The empirical analysis in this paper is focused on Kyrgyzstan, a low-income country located in Central Asia. A large number of people from Kyrgyzstan move to Russia and Kazakhstan, mainly in search of better income-earning opportunities. Estimates range from 200,000 to more than one million migrants (Schmidt and Sagynbekova, 2008; Ablezova et al., 2009;
Lukashova and Makenbaeva, 2009). For 2013, it is estimated that migrants sent US$ 2.3 billion as remittances back home,
which translates into 31% of Kyrgyzstans GDP (World Bank, 2013). This makes the country number two worldwide in terms
of remittances receipt. It is unclear how such massive outmigration changes the system of private transfers and mutual help
that is common in Kyrgyzstan. Informal social networks based on kinship, friendship and neighborhood played a large role
for obtaining access to information and goods in pre-Soviet times as well as during the Soviet period, and they are still
important today in Kyrgyzstan (Coudouel et al., 1997; Kuehnast and Dudwick, 2002). Anecdotal evidence from Howell
(1996) suggests that borrowing food and money from relatives and neighbors in times of economic stress is a common practice in southern Kyrgyzstan, the part of the country with the currently largest migration rate.
Empirical identication of the effect of migration on transfer behavior within migrant sending communities can be confounded by simultaneity and unobserved heterogeneity. Simultaneity can be a problem if communities with more private
transfers among households experience more or less out-migration. Unobserved heterogeneity is a serious concern because
differences between migrant and non-migrant households might inuence both migration and private transfer decisions
(McKenzie et al., 2010). To address simultaneity concerns, we use longitudinal data from the Life in Kyrgyzstan (LIK) household survey and run a lagged regression model. To address unobserved heterogeneity, we match migrant and non-migrant
households on a wide range of variables using propensity score matching methods.
Our ndings show that migrant households are more likely than non-migrant households to provide monetary transfers
to others. Furthermore, we nd that migrant households are more likely than non-migrant households to receive labor assistance from others. We do not directly observe to whom these transfers are made and from whom they are received in our
data. However, we provide suggestive evidence that migrant households, through their access to remittance income, insure
their social networks against shocks or redistribute income to poorer households in the community and receive labor

Ratha et al. (2011) provide an excellent review of the literature on the welfare implications of migration.
In a lab experiment, Charness and Genicot (2009) nd evidence of lower transfers in groups with higher ex ante within-group inequality. The experiment is
restricted to the possibility of monetary transfers alone. It could be that if group members were allowed to reciprocate the monetary transfers made by richer
group members with non-monetary transfers, transfers would increase with higher inequality.
3

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T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

transfers in return.4 If so, our ndings indicate that differentiating between monetary and labor transfers is important to draw
correct inferences about the reciprocity of transfers.
The rest of this paper is organized as follows. We discuss alternative mechanisms for the relationship between migration
and households transfer behavior in the next section. We provide background information on migration from Kyrgyzstan in
Section 3. Section 4 discusses our empirical strategy, and Section 5 introduces the LIK data. Section 6 presents the estimation
results. We here also conduct a number of robustness checks and elaborate on the reciprocity of transfers. We conclude the
paper by summarizing our ndings in Section 7.

2. Analytical framework
We provide an overview of the mechanisms through which migration may inuence household transfer behavior. We distinguish between the effect of migration and the effect of remittances since having a migrant abroad does not necessarily
have the same consequences for household welfare as receiving remittances. Furthermore, households that have migrants
abroad do not always receive remittances, and households that receive remittances do not always receive them from close
family members but possibly from extended family members or non-relatives.
Migration may strengthen the extent of monetary transfers in migrant sending communities if there is a co-insurance
scheme between the migrant and the household left behind (Stark and Lucas, 1988) and if other community members provide part of the insurance that ows to the migrant (mechanism 1). Migration may weaken the extent of monetary transfers,
however, because a high rate of migration at the community level decreases commitment in mutual transfer arrangements.
Migration of community members decreases the credibility of future reciprocity, and reciprocity is necessary to sustain nonenforceable transfer arrangements (Ligon et al., 2002).5 Households may choose not to provide monetary transfers to others,
who they think are likely to migrate because reciprocity would then be less possible in the future. Households may also reduce
transfers to those with current migrants, if they think that the members left behind are less likely to reciprocate (mechanism 2).
The same logic applies to non-monetary transfers; households may not provide labor to other households within their community if these already have migrants abroad or are expected to send household members abroad in the future (mechanism 3). Yet,
it is also reasonable to expect more labor transfers to households that have migrants abroad because usually young male adults
migrate while the elderly, women, and children are left behind (mechanism 4). For example, grandparents who stay with their
grandchildren are likely to use more outside labor to help with house repairs or accompany grandchildren to school when their
adult children are absent.
We turn to remittances. Remittances may increase the extent of monetary transfers because they provide access to
income that is uncorrelated with income generated within the community. Remittance-receiving households may thus be
better able to provide transfers to their networks and insure them against aggregate shocks (Morten, 2013) (mechanism 5).6 This
argument builds on Foster and Rosenzweig (2001) who study the effect of different degrees of altruism and income variance
between transfer partners on the size of transfers, using panel data from rural South Asia. They show that risk-sharing is
achieved with a high degree of altruism and a low level of income correlation between transfer partners. Some risk-sharing even
takes place in the absence of altruism. Alternatively, remittances may be positively related to monetary transfers because they
may provide more stable income to the remittance-receiving household making it a low risk member in risk-sharing
arrangements (Gallego and Mendola, 2013) (mechanism 6). If private transfers are made to redistribute income, rather than
to share risk, more monetary transfers may be expected if the better off partner in the income redistribution network is the
one who receives the remittances (mechanism 7). In contrast, households may reduce their monetary transfers for income
redistribution if the remittance receiver is the previously worse off partner in the network (mechanism 8).
Remittances may decrease monetary transfers in the migrant sending community because they make the outside option
of autarky more attractive for remittance-receiving households; risk-sharing is likely to fall whenever the value of autarky
increases relative to the value of being in the contract (Albarran and Attanasio, 2003). Remittance-receiving households can
use remittances to insure against shocks and do not need to engage in mutual transfer arrangements within the community
(Morten, 2013) (mechanism 9). Remittances may allow receiving households to exchange money for labor (Schechter and
Yuskavage, 2011). Specically, households that receive remittances may transfer money to other households and receive
labor in times of need. This seems particularly likely when the adult members of the household migrate (mechanism 10).
In sum, migration can have a positive or negative impact on household private transfers, and the relationship between
remittances and private transfers is equally indeterminate. While we cannot clearly identify the mechanisms of how migration and remittances affect transfers in our empirical analysis, given the nature of our data, we interpret our ndings in light
of these theoretical considerations.
4
An alternative explanation is that the migrant households are better able to purchase labor services. However, the wording of the questions in our survey
questionnaire clearly indicates that we were asking only for unpaid labor transfers.
5
Ligon et al. (2002) assume that informal insurance arrangements are sustained by means of penalties for breach of contract. These penalties include peer
group pressure or being brought before a village council with the threat of future exclusion from insurance at the community level.
6
Remittances respond to income shocks of the receiving household and so have an insurance motive (Lucas and Stark, 1985; Rosenzweig, 1988; Fafchamps
and Lund, 2003; Yang and Choi, 2007). Giesbert et al. (2011) show that households, which receive remittances, are less likely to have formal insurance which
also speaks for an insurance function of remittances. Du et al. (2011) nd that remittances may even play a role in promoting interprovincial risk sharing. What
has not been studied much is whether remittances sent for insurance are shared with the social network.

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3. Background: migration in Kyrgyzstan


Kyrgyzstan is one of the poorest former Soviet Union republics. It is small (with a population of 5.6 million), mountainous,
and landlocked. Sixty-ve percent of the population live in rural areas. In contrast to neighboring Kazakhstan and Uzbekistan, Kyrgyzstan is not endowed with major stocks of natural resources (except for gold). According to the World Bank, 82%
of the male population aged 1564 participated in the labor force in 2012, but only 59% of the female population. Among
those employed, 34% worked in agriculture, 21% in industry, and 45% in services. The transition from a planned to a market
economy, including the elimination of guaranteed employment, free education and health care, and special support services
for pensioners and mothers, has hit Kyrgyzstan very hard (Isabaeva, 2011). It has still not fully recovered to its pre-independent level of output. In 2012, 38% of the population lived below the national poverty line, up from 32% in 2009.7
Against this background, it is not surprising that many people migrate to more advantaged places in search of jobs and
better living conditions. People move both domestically, from rural to urban areas, as well as internationally, typically to
Russia and Kazakhstan. The exact number of migrants is difcult to determine, as domestic migrants tend to not register
at their new place of residence and international migrants are often illegally in the destination country. However,
Isabaeva (2011) claims that international migration has overtaken domestic migration numerically in recent years. Migration is often temporary; ranging from a few months to several years, according to a survey among households in three communities in the Jalalabad region (Schmidt and Sagynbekova, 2008). The average duration appears to be around two years for
international migrants, and shorter for domestic migrants.
Atamanov and van den Berg (2012) analyse data from a nationally representative survey conducted in Kyrgyzstan by the
Asian Development Bank in 2007. They investigate the determinants of seasonal (repeated episodes each with a duration of
up to one year) and non-seasonal (duration of more than one year) international migration among rural households. They
nd that education and land ownership are important drivers of migration decisions. Being better educated inuences
the decision to migrate for an extended period of time as compared to engage in farming, but it does not play a role for
the decision to migrate seasonally. This indicates differential returns to education for the different migration forms. Land
ownership positively determines both seasonal and non-seasonal migration, pointing to high migration costs which only
the more afuent can afford to pay.

4. Empirical strategy
Our aim is to understand whether international migration and remittances help or hinder the degree of cooperation in the
form of private transfers between households in the absence of formal credit markets. We investigate the extent to which
migrant households differ from non-migrant households in their transfer behavior using the following specication:

Y ij a b1 M ij b2 X ij b3 Dj eij

where Yij is an indicator of whether transfers are provided (received) by household i residing in community j. We estimate
separate models for monetary and non-monetary transfers and separate models for the provision and receipt of transfers.8
Eq. (1) is thus estimated for four alternative dependent variables. In our rst step, we dene Mij as a dummy variable indicating
whether household i in community j has a migrant member or not. A household has a migrant member if an adult member has
been working abroad for more than a month in the last 12 months. In our second step, we dene Mij as a dummy variable indicating whether a household receives remittances or not. A household is a remittance-receiving household if it has received any
money from abroad during the last 12 months. The person who sends these remittances may or may not be a member of this
household. We control for other household level variables, Xij, that may generate differential transfer behavior between migrant
and non-migrant households or remittance and non-remittance households.
We derive the control variables, Xij, from those used in Gallego and Mendola (2013). Specically, we include socio-demographic variables, namely age, gender, marital status, education, and ethnicity of the household head. We also control for
household size, the ratio of dependents (i.e. members below the age of six and above the age of 69) in the household,
and the ownership of wealth. The wealth index is constructed using principal components analysis based on ownership
of household assets such as land, a car, a computer, a washing machine, and the number of livestock. It is possible that
involvement in social networks drives both the migration decision and transfer behavior. To address this concern, we control
for membership in a number of social groups (such as professional unions, credit and savings groups, neighborhood committees, and sports groups).
The community is assumed to be the potential network of a household. We dene the community as the local community
(called aiyl okrug), which is the lowest administrative level in Kyrgyzstan and consists of four villages on average. According
to the 2009 Census, an average local community has a population of 367 households. We control for community xed effects,
Dj, which allows us to compare the behavior of migrant and non-migrant households, or remittance and non-remittance
7

All numbers provided in this paragraph are taken from the World Development Indicators (World Bank).
If households both give and receive transfers, they appear with the outcome variable equal to 1 both in the giving and the receiving regressions. See Section
5 for details on the extent of this overlap.
8

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T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

households, within each community. This controls for heterogeneity between communities. In Table A1 in the Appendix A,
we dene all variables that we use in the estimations and present summary statistics.
b1 is the coefcient of our interest. If b1 is positive, migrant households provide (receive) more private transfers than nonmigrant households. The same applies to remittance-receiving vs. non-remittance-receiving households.

5. Data and descriptive statistics


The data we use in our empirical analysis come from the Life in Kyrgyzstan (LIK) survey. This is a panel survey conducted
annually between 2010 and 2012 by the German Institute for Economic Research (DIW Berlin) in collaboration with Humboldt-University of Berlin, the Centre for Social and Economic Research (CASE-Kyrgyzstan) and the American University of
Central Asia (Brck et al., 2013). The LIK includes data from all seven Kyrgyz provinces (oblasts) and the cities of Bishkek and
Osh. Data are collected at the community, household, and individual levels of the sampled households. At the time of our
data analysis, the rst two waves (20102011) of the LIK were nalized. We mainly use data from the second wave because
this provides more information on private transfers than the data from the rst wave. In the second wave, 2863 households
in 120 urban and rural communities and 8066 adult individuals within these households were interviewed. This is in comparison to 3000 households who were interviewed in 2010. Out of the 137 households that dropped out between 2010 and
2011, around 7% had at least one migrant household member in 2010. The total population in the 2011 sample households
(including children) is 13,693.
The interviewed households were asked whether any of their regular members had been living abroad for more than one
month (excluding business trips, vacations, and visits) during the last 12 months. Out of the 2863 households, 485 reported
to have one or more migrants, and 712 migrants were reported in total. This translates into 5% of the total sample being
migrants. Table 1 provides information on the characteristics of the observed migrants. The average age of a migrant is
29 years. Two thirds of the migrants are male and almost half are married. Three quarters of the migrants are of Kyrgyz ethnicity, and the majority of them come from the South (Osh city, Osh, Jalalabad, and Batken oblasts) of the country. Ninety
percent of the migrants have a secondary education degree or higher. They usually go to Russia and work in either construction or trade and repair. The average migrant is outside the country for 8.8 months per year. Note that there is a substantial

Table 1
Characteristics of migrants. Source: Authors illustration based on 2011 LIK survey data.
Variables

All migrants

Agea

29.04
(9.51)
68.3
44.9
71.1
21.1
1.7
6.1
9.7
76.8
13.5
91.9
6
2.1
84.7
69.9
40.2
23.1
10.7
26
8.8
5.5
(3.24)
54,055
(51,370)

Maleb
Marriedb
Kyrgyzb
Uzbekb
Russianb
Other ethnicityb
Basic education or belowb
Secondary educationb
University degreeb
In Russiab
In Kazakhstanb
In another countryb
Comes from the South of Kyrgyzstanb
Comes from rural areab
Works in construction sectorb
Works in trade and repairb
Works in hotels and restaurantsb
Works in another sectorb
Number of months abroad in the last year
Frequency of remittances in the last yeara
Amount of remittancesa,c (in Kyrgyz Soms)
N

712

Note: Only migrants aged 15 and above are considered. Some of the characteristics are based on
only migrants that are abroad at the time of the survey. The LIK does not collect data on the
country of destination, the economic sector and the remittances sent from migrants that have
returned.
a
Mean with standard deviation in parentheses.
b
Proportion of migrants.
c
1 USD  45 KGS.

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

695

difference between migrants that had returned by the time of the survey (which account for 21% of all migrants) and
migrants who were still abroad (79% of all migrants). The mean number of months abroad is 6.8 (median is 7) for the
returned migrants; the mean number is 9.3 (median is 11) for the current migrants.9 Migrants send money home frequently,
almost once every two months. The average amount of remittances was 54,000 Kyrgyz Soms (equivalent to approx. US$ 1200)
per year as of 2011. For the average household that receives remittances, they account for one third of its total household
income.
From the total sample of 2863 households, we drop 42 households that have missing information on our key variables.
We also restrict our analysis to rural areas. Typically, credit and insurance markets are more developed in urban areas, making private informal transfers less important for urban households. In addition, communities in urban areas are characterized
by fewer repeated interactions and more information asymmetries compared with rural locations, which makes the
exchange of private transfers more difcult (Cox and Jimenez, 1998; Albarran and Attanasio, 2003). Moreover, most of
the migrants in Kyrgyzstan stem from rural areas. Compared to 21% of rural households, only 12% of urban households have
a migrant abroad. Hence, we expect the relationship between migration and informal transfer behavior to be less relevant in
the urban context. To be sure, we ran the regression of Eq. (1) for urban households. There is indeed no difference in the
transfer behavior of migrant and non-migrant households as well as of remittance and non-remittance households.
We exclude the 1168 urban households from our sample which leaves us with 1653 households. Of these, 341 (i.e. 21%)
had a migrant abroad in the 12 months prior to the 2011 survey.10 Of these migrant households, 70% received remittances. In
turn, of all households that received remittances (these are 304 households), 86% had household members that were abroad.
These are very high shares, which imply that the effects of migration are not easily distinguishable from the effects of remittances. In the estimation, we compare the transfer behavior of (a) households that have a migrant abroad with households that
do not have a migrant abroad (341 vs. 1312 households), and (b) households that receive remittances with households that do
not receive remittances (304 vs. 1349 households). Given that these categories overlap to a large extent, we do not expect the
results to deviate much from each other.
The following questions about transfer behavior are asked in the individual questionnaire of the 2011 LIK:
To how many people did you give any nancial help during the last 12 months?
From how many people did you receive any nancial help during the last 12 months?
To how many people did you give any non-nancial help (e.g. repairing house, preparing celebrations, homework help)
during the last 12 months?
From how many people did you receive any non-nancial help (e.g. repairing house, preparing celebrations, homework
help) during the last 12 months?
We compute four alternative household-level dummy variables (our dependent variables in the below estimations) from
these four questions by aggregating information over the individual household members. The resulting dummy variables
indicate whether or not any household member provided transfers to others or received transfers from others. We do not
use the absolute number of transfers, given or received, as an outcome variable because of the following concerns. First, there
is the danger of double counting, as two or more individuals within the same household might report the same transfer. Second, when we compare the maximum number of transfers reported in 2010 with that reported in 2011, we nd a fourfold
increase. Such a questionable increase is not observed when we investigate whether or not a household gave or received at
all.
We obtain the following four outcome variables. The rst two variables (hh_give_nhelp and hh_rec_nhelp) take the value
of 1 if any member of a particular household reported to have made or received a monetary transfer in the last year, and 0
otherwise. The other two variables (hh_give_nonnhelp and hh_rec_nonnhelp) take the value of 1 if any member of a particular household reported to have made or received a non-monetary transfer in the last year, and 0 otherwise. Through the use
of examples (repairing the house, preparing celebrations, and help with homework) in the questions referring to nonmonetary transfers, we ensure that people do not report paid labor. In Kyrgyzstan, the listed activities are typically
conducted by relatives, friends and neighbors without payment.
The LIK contains some information about the transfer partners. Individuals were asked to what group their transfer partners mainly belonged. Partners were mostly relatives (between 60% and 73% for the four transfer categories). Other relevant
groups are neighbors and friends, with neighbors being more important in the case of non-monetary transfers. This is in line
with previous research, which found that family and kinship networks are most important to households transfer behavior
and that geographic proximity matters (Fafchamps and Lund, 2003; De Weerdt and Dercon, 2006; Fafchamps and Gubert,
2007; Munshi and Rosenzweig, 2009; Mazzocco and Saini, 2012).
Out of the total number of rural households, about half provided monetary transfers to others, and half provided nonmonetary transfers to others (Table 2). Forty percent of the households received monetary transfers, and 45% received
non-monetary transfers. Households are not necessarily either pure givers or pure receivers. Of all those households that give
or receive monetary transfers, 28% both give and receive. Among those that give or receive non-monetary transfers, 40% both
9
A seasonal pattern is clearly established for the returned migrants: most of them had been abroad between February and June. For the current migrants,
there is no such well-dened seasonality.
10
This is very close to the estimate by Atamanov and van den Berg (2012): They nd that 17.3% of rural households had a migrant abroad in 2006.

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Table 2
Prevalence of private transfers. Source: Authors illustration based on 2011 LIK survey data.
Monetary transfer

Non-monetary transfer

How many households provided help? (%)


Yes, provided help
No, did not provide help

47.9
52.1

51.5
48.5

How many households received help? (%)


Yes, received help
No, did not receive help

39.6
60.4

45.0
55.0

give and receive. Cox et al. (1998) studied private transfers in Kyrgyzstan in the early 1990s. They nd that only 12% of all surveyed households were net recipients and 9% net givers. However, their reference period is only 30 days, much shorter than
ours. Fig. A1 in the Appendix A sheds some light on the difference between migrant and non-migrant households in terms of
transfers made and received. The shares of migrant and non-migrant households are signicantly different for all four transfer
variables. Fig. A2 illustrates differences in transfer behavior between remittance and non-remittance households. Remittance
and non-remittance households differ signicantly on receiving monetary transfers and providing non-monetary transfers.
In Table 3 (Panel A), we present descriptive statistics for the control variables, separately for migrant and non-migrant
households; we test for differences in these characteristics in the two groups.11 Migrant households differ from non-migrant
households on age and ethnicity of the household head as well as household size.12 Note that household size counts the resident
members only. Migrant households may be larger than non-migrant households either because only very large households send
migrants abroad or because household members left behind by migrants join other households. The second option seems likely
in the Central Asian context where the wife of a migrant is expected to co-reside with her parents-in-law when her husband is
abroad. This is supported by the fact that migrant households have on average less dependents as a share of the total number of
household members than non-migrant households. Additionally, Table 4 shows a detailed age breakup of the share of male
members in the migrant and non-migrant households. As expected, migrant households have a much lower fraction of adult
men between the age of 20 and 50, the prime migration age, than non-migrant households. As we show below, this absence
of adult men might be driving non-monetary transfer behavior of households within migrant communities.

6. Estimation results
6.1. Baseline estimation
The results of the estimation of Eq. (1) for migrant vs. non-migrant households as well as remittance vs. non-remittance
households are shown in Table 5.13 The number of observations varies from the 1653 sample households and across the columns because some community xed effects perfectly predict the dependent variable. There are some communities where
either all or none of the respondent households give or receive transfers. All households within such communities are omitted
from the probit estimation.
Migrant households are 12 percentage points more likely than non-migrant households to provide monetary transfers. In
addition, migrant households are 13 percentage points more likely than non-migrant households to receive non-monetary
transfers. However, migrant households do not differ from non-migrant households in terms of receiving monetary help or
giving non-monetary help. We repeat the analysis with an indicator of whether a household receives remittances. Households that receive remittances are 7 percentage points more likely than their non-receiving counterparts to make monetary
transfers to others. However, there is no signicant difference between remittance and non-remittance households in terms
of receiving non-monetary help.14
Additionally, the survey provides information on the amount of remittances received by households. This allows us to
look at the effect of remittances on transfer behavior at the intensive margin. The results from this analysis are reported
in Table 6. When remittance receipt increases by 1000 Soms (approx. US$ 22), households are 2.4 percentage points more
likely to give monetary transfers and 1.4 percentage points more likely to receive non-monetary help.
11

Comparing the means of the control variables for remittance and non-remittance households shows a very similar pattern. See Table A2 in the Appendix A.
In 27 of our 341 migrant households, the head is a migrant who is still abroad at the time of the survey. For these households, we re-dene the head to be
the second oldest person in the household (if the head was the oldest, which is most often the case) in order to compute the household heads characteristics to
be used as control variables in the estimations.
13
All probit estimations report marginal effects evaluated at the mean.
14
In principle, domestic migration may have similar impacts on private transfers as international migration. In our sample, we observe that 9% of all
households, or 12% of rural households, had domestic migrants. However, we nd no differential transfer behavior between households with and without
domestic migrants. We think that this is because (1) the identication of domestic migrants in the data is based on a much shorter reference period than that of
international migrants and (2) domestic migrants can return home more easily and frequently so that adjustments within the community in response to
migration are less likely.
12

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T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705


Table 3
Summary statistics. Source: Authors illustration based on 2011 LIK survey data.
Panel A: Unmatched sample

headage
headmale
headmarried
headkyrgyz
headuzbek
headrussian
headother
yrs_schooling
hhsize
depend
wealth_index
anygroupmem

Panel B: Matched sample

Non-migrant households
(N = 1312)

Migrant households
(N = 341)

Difference

Non-migrant households
(N = 1311)

Migrant households
(N = 338)

Difference

51.5
(14.7)
0.767
(0.423)
0.741
(0.438)
0.723
(0.448)
0.098
(0.297)
0.063
(0.244)
0.116
(0.320)
10.39
(2.68)
5.11
(2.10)
0.183
(0.207)
0.325
(0.829)
0.082
(0.275)

53.5
(11.7)
0.760
(0.428)
0.798
(0.402)
0.751
(0.433)
0.196
(0.397)
0.009
(0.093)
0.044
(0.205)
10.27
(2.60)
5.38
(2.12)
0.141
(0.164)
0.398
(0.679)
0.091
(0.288)

2.01
(2.34)
0.007
(0.31)
0.057
(2.17)
0.028
(1.01)
0.098
(5.08)
0.054
(4.05)
0.072
(3.94)
0.12
(0.73)
0.27
(2.14)
0.042
(3.50)
0.073
(1.51)
0.008
(0.51)

53.7

53.6

0.10
(0.14)
0.001
(0.02)
0.009
(0.28)
0.000
(0.01)
0.005
(0.16)
0.002
(0.28)
0.004
(0.20)
0.01
(0.04)
0.02
(0.13)
0.02
(0.17)
0.005
(0.09)
0.002
(0.07)

0.767

0.766

0.787

0.796

0.757

0.757

0.184

0.189

0.011

0.009

0.048

0.044

10.25

10.26

5.41

5.39

0.144

0.142

0.398

0.403

0.087

0.089

Note: Mean with standard errors in parentheses. Difference with t-statistics in parentheses.

Table 4
Household composition. Source: Authors illustration based on 2011 LIK survey data.
Share of males in different age
groups (in percent)

Non-migrant households

Migrant households

09
1019
2029
3039
4049
5059
6069
70 and above

51.84
50.58
48.31
48.05
50.00
44.14
45.20
40.17

52.24
50.11
43.24
42.25
40.55
45.55
48.75
45.45

We check for the possibility that our results are driven by a simple wealth effect. Migrant (remittance-receiving) households may transfer more monetary help than households without migrants (not receiving remittances) because they are
wealthier and not because their income comes from uncorrelated sources. To address this concern, we run the regression
of Eq. (1) without the wealth index. If it is the difference in wealth that drives our results, the marginal effect of the migration/remittance indicator should be larger when the wealth index is not controlled for. However, the marginal effects remain
almost unchanged (compared to those reported in Table 5) after removing the wealth index variable. The results are reported
in Table A3 in the Appendix A.
What do these results imply in terms of the mechanisms outlined in Section 2? If we assume that migrant households
behaved like non-migrant households before migration, we can conclude that migration and remittances increase the extent
of monetary transfers and non-monetary transfers made within the community. We observe more monetary transfers made
by migrant (remittance) households compared with non-migrant (non-remittance) households, which could mean that
migrant (remittance) households insure their social networks against shocks (mechanism 5) or that they redistribute income
to poorer households in the community (mechanism 7). In terms of non-monetary transfers, we nd that migrant households
are more likely to receive labor help from other households which seems to indicate that migrant households require more
labor help in the absence of co-residing adult members (mechanism 4).15 With regard to the amount of remittances, we nd

15
Ablezova et al. (2009) provide evidence for elderly people living alone or with grandchildren in many Kyrgyz villages. In-depth interviews with the elderly
show that migration of their adult children is a serious challenge for them.

698

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

Table 5
Association of migration and remittances with private transfers. Source: Authors calculation based on 2011 LIK survey data.
Probit model, reported are marginal effects
Variables

Give monetary help

Receive monetary help

Give non-monetary help

migrant_hh

0.1227***
(0.0382)
.
.
0.0034**
(0.0014)
0.0903*
(0.0519)
0.0966**
(0.0486)
0.0598
(0.0844)
0.0216
(0.1353)
0.0554
(0.1039)
0.0267***
(0.0097)
0.1036
(0.0865)
0.0076
(0.0071)
0.1960***
(0.0504)
0.1007***
(0.0241)

.
.
0.0740*
(0.0382)
0.0035**
(0.0014)
0.0832
(0.0521)
0.1075**
(0.0485)
0.0566
(0.0843)
0.0137
(0.1343)
0.0624
(0.1038)
0.0266***
(0.0099)
0.1171
(0.0868)
0.0074
(0.0070)
0.1932***
(0.0496)
0.1021***
(0.0243)

0.0232
(0.0427)
.
.
0.0010
(0.0012)
0.0618
(0.0502)
0.0394
(0.0506)
0.0597
(0.0812)
0.0120
(0.1308)
0.0947
(0.0688)
0.0093
(0.0090)
0.0274
(0.1016)
0.0048
(0.0075)
0.1439**
(0.0636)
0.0307
(0.0214)

.
.
0.0007
(0.0506)
0.0010
(0.0012)
0.0587
(0.0498)
0.0362
(0.0502)
0.0599
(0.0812)
0.0089
(0.1300)
0.0954
(0.0682)
0.0093
(0.0090)
0.0243
(0.1015)
0.0047
(0.0075)
0.1430**
(0.0636)
0.0301
(0.0215)

0.0229
(0.0432)
.
.
0.0002
(0.0015)
0.0423
(0.0688)
0.0302
(0.0666)
0.0460
(0.1011)
0.0049
(0.1222)
0.0808
(0.1006)
0.0622***
(0.0102)
0.2201**
(0.0992)
0.0115
(0.0070)
0.1103
(0.0850)
0.0277
(0.0289)

.
.
0.0296
(0.0457)
0.0002
(0.0015)
0.0414
(0.0679)
0.0296
(0.0663)
0.0474
(0.1014)
0.0059
(0.1222)
0.0795
(0.1004)
0.0622***
(0.0102)
0.2182**
(0.0991)
0.0116*
(0.0070)
0.1099
(0.0844)
0.0277
(0.0288)

0.1328**
(0.0537)
.
.
0.0040**
(0.0016)
0.1002
(0.0696)
0.1969***
(0.0633)
0.0610
(0.1165)
0.1277
(0.1304)
0.1977
(0.1585)
0.0305***
(0.0100)
0.0448
(0.0941)
0.0078
(0.0080)
0.1023
(0.0841)
0.0038
(0.0248)

.
.
0.0718
(0.0447)
0.0040***
(0.0015)
0.1059
(0.0685)
0.2050***
(0.0620)
0.0562
(0.1166)
0.1347
(0.1309)
0.2025
(0.1566)
0.0310***
(0.0100)
0.0603
(0.0932)
0.0077
(0.0079)
0.1028
(0.0855)
0.0044
(0.0245)

1607
0.247

1607
0.244

1584
0.298

1584
0.298

1374
0.353

1374
0.353

1341
0.343

1341
0.340

remitt_hh
headage
headmale
headmarried
headkyrgyz
headuzbek
headrussian
hhsize
depend
yrs_schooling
anygroupmem
wealth_index
N
Pseudo-R2

Receive non-monetary help

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering). The number of observations
varies across the columns and from the total number of sample households because some community xed effects perfectly predict the dependent variable.
*
Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

Table 6
Association of remittance amount with private transfers. Source: Authors calculation based on 2011 LIK survey data.
Probit model, reported are marginal effects
Variables

Give monetary help

Receive monetary help

Give non-monetary help

Receive non-monetary help

remitt_amount
Controls

0.0236***
(0.0069)
Yes

0.0026
(0.0064)
Yes

0.0033
(0.0073)
Yes

0.0140**
(0.0063)
Yes

N
Pseudo-R2

1607
0.249

1584
0.298

1374
0.351

1341
0.340

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering). The number of observations
varies across the columns and from the total number of sample households because some community xed effects perfectly predict the dependent variable.

Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

that higher remittances lead to a higher probability of receiving non-monetary help and giving monetary help. This is in line
with our expectations. We would expect the households with higher remittances to receive more non-monetary transfers if,
for instance, non-monetary transfers were made in reciprocation to monetary transfers.
6.2. Endogeneity
One concern with the above analysis is the possibility of simultaneity, or reverse causality. Some communities might
experience more out-migration in response to stronger links (proxied by transfers) between households, biasing the estimates upwards. To ameliorate such concerns, we exploit the panel structure of our data and run a lagged model where
the migration decision is taken ahead of the observed transfers of a household. Specically, we estimate the effect of migration status of a household in 2010 on transfer behavior in 2011. Similarly, we also estimate the effect of remittances received

699

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705


Table 7
Association of lagged migration and remittances with private transfers. Source: Authors calculation based on 2010 and 2011 LIK survey data.
Probit model, reported are marginal effects
Variables

Give monetary help

Receive monetary help

migrant_hh (lag)

Controls

0.0830**
(0.0415)
.
.
Yes

.
.
0.1228***
(0.0447)
Yes

0.0665
(0.0409)
.
.
Yes

.
.
0.0243
(0.0392)
Yes

0.0105
(0.0468)
.
.
Yes

.
.
0.0220
(0.0482)
Yes

0.0475
(0.0572)
.
.
Yes

.
.
0.0615
(0.0514)
Yes

N
Pseudo-R2

1607
0.244

1607
0.246

1584
0.299

1584
0.298

1374
0.353

1374
0.353

1341
0.339

1341
0.340

remitt_hh (lag)

Give non-monetary help

Receive non-monetary help

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering). The number of observations
varies across the columns and from the total number of sample households because some community xed effects perfectly predict the dependent variable.

Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

in 2010 on transfer behavior in 2011. Table 7 reports the results from these lagged regressions. The effect of migration and
remittances on providing monetary transfers remains similar. However, the effect of migration on receiving non-monetary
transfers is now imprecisely estimated. This is plausible because households that had a migrant abroad 1224 months ago
are unlikely to require labor help in the last 12 months, i.e. after the migrant had possibly returned.
While this lagged model reduces concerns of simultaneity, the estimates may be biased due to unobserved differences
between migrant and non-migrant households. This is a cause of concern for us since the migrant and non-migrant households vary signicantly across several observed socio-demographic dimensions, as shown in Panel A of Table 3. We address
this concern by matching the migrant and non-migrant households (as well as the remittance and non-remittance households) using propensity score matching. We provide estimates of the effect of migration and remittances on private transfers
using the matched sample (results below).
As an alternate strategy, we also estimate a linear probability model with household xed effects using the longitudinal
structure of the data. However, when running the xed effects model, we are restricted to using the two outcome variables
on giving transfers (hh_give_nhelp and hh_give_nonnhelp) because information on receiving transfers is not available in the
2010 wave of the LIK. The xed effect results (not reported) do not show any signicant effect of migrant status on transfer
behavior. This could be driven by very little variability due to (1) the use of only two time periods, (2) few households changing their migration status between 2010 and 2011 (about 150 migrant households in 2011 did not have migrants in 2010),
and (3) one year being too short a time period for observing signicant changes in transfer behavior of a household. Our preferred way of addressing concerns of unobserved heterogeneity is therefore the matching.
The migration literature identies many characteristics that affect the probability to migrate (Gibson et al., 2013). Following this literature, our set of covariates for matching includes household demographics (household size, fraction of dependents in total household size, age, gender, ethnicity, education, occupation and marital status of the household head), the
households network participation (any group membership), migration experience (migration status of the household head)
and wealth of the household. Furthermore, we try to limit the bias due to locational differences by matching within a province. In addition to these covariates used in the previous migration literature, we also match on the households risk taking
ability. Evidence suggests that migrants are more risk-taking (Jaeger et al., 2010).16 We assume that after controlling for these
characteristics, migrant and non-migrant, as well as remittance and non-remittance, households are comparable. In other
words, we assume that unobserved differences between migrant and non-migrant (as well as remittance and non-remittance)
households are reected in the differences in these observed characteristics.
We dene our treated group as households with migrants (remittances) in the last 12 months and the control group as
non-migrant (non-remittance) households. Using the kernel matching function, we construct propensity scores to match the
control group to the treatment group.17 The kernel function takes the weighted averages of the observations in the control
group as the counterfactual outcome for each observation in the treatment group. For the case of matching migrant and
non-migrant households, we lose three observations because they are off common support. For the case of matching remittance
and non-remittance households, we lose two observations. Panel B of Table 3 reports the mean household characteristics for the
migrant and the non-migrant households in the matched sample. In contrast to the unmatched sample in Panel A, the migrant
and non-migrant households do not vary signicantly across any observed dimension in the matched sample. The same picture
emerges when comparing remittance with non-remittance households (Table A2 in the Appendix A).18
The regression estimates based on the matched sample are reported in Table 8. Migrant households are 15 percentage
points more likely than non-migrant households to give monetary help and 15 percentage points more likely to receive labor
help. Using an indicator for remittances received instead of migrant status provides similar results. Households receiving
16
17
18

At this stage, we lose one household due to a missing value for risk-taking.
The results of the probit model are reported in Table A4 in the Appendix A.
Table A5 provides further evidence on the quality of matching.

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T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

Table 8
Association of migration and remittances with private transfers, matched sample. Source: Authors calculation based on 2011 LIK survey data.
Probit model, reported are marginal effects
Variables

Give monetary help

Receive monetary help

Give non-monetary help

migrant_hh

Controls

0.1465***
(0.0401)
.
.
Yes

.
.
0.1579***
(0.0405)
Yes

0.0349
(0.0372)
.
.
Yes

.
.
0.0514
(0.0386)
Yes

0.0327
(0.0472)
.
.
Yes

.
.
0.0053
(0.0499)
Yes

0.1538***
(0.0494)
.
.
Yes

.
.
0.0923*
(0.0509)
Yes

N
Pseudo-R2

1603
0.267

1604
0.259

1580
0.290

1581
0.300

1371
0.374

1372
0.389

1337
0.387

1338
0.402

remitt_hh

Receive non-monetary help

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering). The number of observations
varies across the columns and from the total number of sample households because some community xed effects perfectly predict the dependent variable.
*
Signicant at 10%.

Signicant at 5%.
***
Signicant at 1%.

Table 9
Reciprocity of private transfers. Source: Authors calculation based on 2011 LIK survey data.
OLS model, reported are coefcients
Variables

Dependent: receive non-monetary help

Dependent: receive monetary help

Dependent: receive non-monetary help

givenXmig

Controls

0.0860
(0.0532)
.
.
0.1045***
(0.0245)
.
.
.
.
.
.
0.0039
(0.0342)
.
.
Yes

.
.
0.1305**
(0.0535)
0.0991***
(0.0240)
.
.
.
.
.
.
.
.
0.0486
(0.0312)
Yes

0.0157
(0.0597)
.
.
0.2087***
(0.0386)
.
.
.
.
.
.
0.0103
(0.0337)
.
.
Yes

.
.
0.0234
(0.0656)
0.2068***
(0.0384)
.
.
.
.
.
.
.
.
0.0041
(0.0402)
Yes

.
.
.
.
.
.
0.0262
(0.0625)
.
.
0.4311***
(0.0534)
0.0528
(0.0347)
.
.
Yes

.
.
.
.
.
.
.
.
0.0369
(0.0549)
0.4292***
(0.0536)
.
.
0.0177
(0.0314)
Yes

N
R2

1653
0.497

1653
0.497

1653
0.374

1653
0.374

1653
0.585

1653
0.584

givenXrem
hh_give_nhelp
givenonnXmig
givenonnXrem
hh_give_nonnhelp
migrant_hh
remitt_hh

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering).

Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

remittances are 16 percentage points more likely to provide monetary help and 9 percentage points more likely to receive
labor help. The latter result, which was insignicant in the unmatched sample, is now statistically signicant at the 10% level.
Overall, the matching results indicate that the results in our baseline specication in Table 4 are biased downwards by a few
percentage points. One possibility for this bias is that households characterized by a higher risk-loving attitude are more
likely to have migrants abroad (and, hence, to receive remittances) and less likely to informally insure themselves against
shocks. If much of the transfer behavior is driven by risk-sharing motives, the households tending to take more risk are less
likely to engage in transfers.
6.3. Reciprocal transfers
Overall, our ndings show that migrant households (remittance households) are more likely than non-migrant households (non-remittance households) to provide monetary transfers to others and receive labor assistance from others. One
possible underlying mechanism is reciprocity migrant households, through their access to remittance income, give monetary help to non-migrant households who cannot afford to return monetary help but instead reciprocate by providing nonmonetary help. Since many households in our data both give and receive transfers, we use this information to shed light on
the underlying mechanism. Particularly, we explore whether households that give monetary help are the ones that receive
non-monetary help and whether this effect is larger for migrant households compared to non-migrant households. We

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

701

regress the receipt of non-monetary help on migrant status (remittance receipt), the provision of monetary help, an interaction term of these two variables (givenXmig and givenXrem) and all the control variables included in Table 5.19
We nd that there is substantial reciprocity in transfers. Those households that give monetary help are more likely to
receive labor assistance compared with those that do not give monetary help. This is even more so for remittance-receiving
households. Those remittance-receiving households that provide monetary help are signicantly more likely to receive labor
assistance compared with households that do not receive remittances. Even though the interaction term is also positive for
migrant households, it is not statistically signicant. In the latter columns of Table 9, we also investigate reciprocity for the
respectively same type of transfer. Again, there is signicant reciprocity: Households that provide monetary help are more
likely to receive monetary help, and households that provide labor assistance are more likely to receive labor assistance.
However, there is no differential behavior across migrant (remittance) and non-migrant (non-remittance) households here.
We acknowledge that we cannot clearly identify the full extent of reciprocity in our data, since we do not observe which
particular households the transfers are going to and coming from. Nevertheless, we argue that the evidence provided here
is suggestive of the fact that households, which receive remittances, provide money to their social networks and receive
labor assistance in return.
7. Conclusion
Economists have long engaged in understanding the role of migration and inter-household private transfers for managing
households risk in developing countries where insurance and credit markets are typically weak. Little is known about the interaction of these two risk management strategies in the communities of migrants origin. Given the massive out-migration from
many developing countries, it is important to know the impact of migration on widely established private transfer systems.
In this paper, we empirically assess the relationship between international migration and private transfers among households left behind in the migrant sending communities of rural Kyrgyzstan. We nd that migration is unlikely to lead to a
weakening of private transfers. Migrant households are more likely than non-migrant households to provide monetary
transfers to others. This could be an indication that migrant households insure non-migrant households against income
shocks or redistribute income to them. If so, our ndings reveal a signicant positive externality at the community level,
resulting from out-migration of some adult community members. Migration and consequent remittances then increase
the welfare not only of migrant households but also of non-migrant households. Welfare estimations of migration should
take this potential positive externality into account.
As noted in Section 1, if migration decreased the extent of private transfers within migrant sending communities, the government would have an active role to play by substituting private transfers with public transfers. However, our results indicate that there is no decrease in private transfers; migration may instead even lead to an increase in the extent of private
transfers. This implies that government intervention, in terms of public transfers, is less needed in communities with intact
social structures, such as those of rural Kyrgyzstan. On the other hand, policies facilitating temporary migration and easing
international transfer of remittances may be helpful to reduce wealth inequalities in communities characterized by informal
transfer systems.
A deeper look into our results suggests that targeted public transfers might actually disturb the private equilibrium in
societies with traditional transfer systems. Given that migrant households are net givers of monetary help and net receivers
of labor help, it is possible that the labor transfers come from non-migrant households. This, in turn, suggests that in the
absence of male adults in migrant households, the non-migrant households provide labor help to the migrant households
in times of need and receive nancial assistance in return. In this situation, a public transfer program targeted toward the
nancially poorer non-migrant households would be likely to disturb the equilibrium. Non-migrant households would then
no longer depend on migrant households for nancial help and would in turn no longer offer labor help to the people left
behind in migrant households.
While we provide some suggestive evidence in support of the idea that migrant households exchange money for labor, we
cannot clearly identify this with our data. In order to correctly determine the partners in transfer arrangements and the
motives of private transfers, future research and more detailed information on household transfer behavior in migrant sending communities are required.
Acknowledgments
This paper was written within the research project Economic Transformation, Household Behavior and Well-Being in
Central Asia. The Case of Kyrgyzstan, which was funded by the Volkswagen Foundation and coordinated by DIW Berlin. We
are grateful to Kathryn Anderson, Ainura Asamidinova, Charles Becker, Margherita Comola, Shamsia Ibragimova, Mariapia
Mendola, Laura Schechter and two anonymous referees for helpful comments on earlier versions of the paper. We also received
crucial feedback from participants of workshops and conferences in Moscow, Chicago, Bonn, Delhi, Einsiedeln, Bishkek,
19
Given that the interpretation of interaction terms in non-linear models is not as straight-forward as in linear models (Norton et al., 2004), we run this
regression as an OLS model (reported here in Table 9) and also produce marginal effects as well as standard errors for a probit model (unreported) using the
STATA command inteff. The results do not differ qualitatively.

702

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705

Madison, and Almaty. Furthermore, our colleagues at the DIW Department for Development and Security provided invaluable
comments. We also thank the German Research Centre for Geosciences in Potsdam, Eugene Huskey and Mohammad Hamayoon
Majidi for providing us with different types of data and Philipp Jaeger and Zalina Sharkaeva for excellent research assistance.
Appendix A
See Figs. A1, A2 and Tables A1A5.
100%
90%
80%
70%
60%

No

50%

Yes

40%
30%
20%
10%
0%
Migrant

Non-migrant

Give monetary

Migrant

Non-migrant

Receive monetary

Migrant

Non-migrant

Give non-monetary

Migrant

Non-migrant

Receive non-monetary

Fig. A1. Transfer behavior in migrant vs. non-migrant households. Source: Authors illustration based on 2011 LIK survey data.

100%
90%
80%
70%
60%

No

50%

Yes

40%
30%
20%
10%
0%
Remittance

NonRemittance
NonRemittance
NonRemittance
Nonremittance
remittance
remittance
remittance

Give monetary

Receive monetary

Give non-monetary

Receive non-monetary

Fig. A2. Transfer behavior in remittance vs. non-remittance households. Source: Authors illustration based on 2011 LIK survey data.

Table A1
Description of variables. Source: Authors illustration based on 2011 LIK survey data.
Variable

Denition

Mean

SD

Min.

Max.

migrant_hh
remitt_hh
headage
headmale
headmarried
headkyrgyz
headuzbek
headrussian
headothereth
yrs_schooling
hhsize
depend
wealth_index
anygroupmem
headrisk
headagri
headnonagri
headunemp
headmobility
hh_give_nhelp
hh_rec_nhelp
hh_give_nonnhelp
hh_rec_nonnhelp

1 = having had a migrant in the past 12 months, 0 = otherwise


1 = having received remittances in the past 12 months, 0 = otherwise
Age of household head in years
1 = household head is male, 0 = otherwise
1 = household head is married, 0 = otherwise
1 = household head is Kyrgyz, 0 = otherwise
1 = household head is Uzbek, 0 = otherwise
1 = household head is Russian, 0 = otherwise
1 = household head is of another ethnicity, 0 = otherwise
Years of schooling of household head in years
Household size (# of individuals currently in the HH)
Ratio of household members older than 69 or younger than 6 in total household size
Households wealth index based on PCA (household assets)
1 = household has any group member, 0 = otherwise
Standardized value for self-assessed willingness to take risks
1 = household head engaged in agriculture, 0 = otherwise
1 = household head engaged in non-agriculture, 0 = otherwise
1 = household head unemployed or inactive, 0 = otherwise
1 = household head born in the oblast of current residence, 0 = otherwise
1 = household provided monetary transfer, 0 = otherwise
1 = household received monetary transfer, 0 = otherwise
1 = household provided non-monetary transfer, 0 = otherwise
1 = household received non-monetary transfer, 0 = otherwise

0.21
0.18
51.9
0.77
0.75
0.73
0.12
0.05
0.10
10.36
5.16
0.17
0.34
0.08
0.03
0.35
0.30
0.35
0.91
0.48
0.40
0.52
0.45

0.41
0.38
14.1
0.42
0.43
0.44
0.32
0.22
0.30
2.66
2.10
0.20
0.80
0.28
0.96
0.48
0.46
0.48
0.29
0.50
0.49
0.50
0.50

0
0
18
0
0
0
0
0
0
0
1
0
2.83
0
1.62
0
0
0
0
0
0
0
0

1
1
99
1
1
1
1
1
1
15
15
1
7.16
1
1.83
1
1
1
1
1
1
1
1

703

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705


Table A2
Summary statistics (remittance vs. non-remittance households). Source: Authors illustration based on 2011 LIK survey data.
Panel A: Unmatched sample

headage
headmale
headmarried
headkyrgyz
headuzbek
headrussian
headother
yrs_schooling
hhsize
depend
wealth_index
anygroupmem

Panel B: Matched sample

Non-remittance
households (N = 1349)

Remittance
households (N = 304)

Difference

Non-remittance
households (N = 1348)

Remittance
households (N = 302)

Difference

51.4
(14.5)
0.775
(0.418)
0.749
(0.434)
0.723
(0.448)
0.107
(0.310)
0.059
(0.236)
0.111
(0.314)
10.38
(2.65)
5.13
(2.08)
0.179
(0.205)
0.324
(0.822)
0.079
(0.270)

54.3
(12.2)
0.727
(0.446)
0.770
(0.422)
0.757
(0.430)
0.164
(0.371)
0.020
(0.141)
0.059
(0.236)
10.28
(2.72)
5.31
(2.22)
0.152
(0.172)
0.412
(0.689)
0.105
(0.307)

2.9
(3.31)
0.048
(1.77)
0.021
(0.77)
0.034
(1.20)
0.057
(2.79)
0.039
(2.81)
0.052
(2.68)
0.10
(0.61)
0.18
(1.32)
0.027
(2.12)
0.088
(1.74)
0.026
(1.47)

54.8

54.4

0.40
(0.34)
0.10
(0.30)
0.005
(0.16)
0.001
(0.03)
0.000
(0.01)
0.000
(0.03)
0.000
(0.05)
0.05
(0.23)
0.01
(0.06)
0.006
(0.45)
0.003
(0.04)
0.004
(0.14)

0.742

0.732

0.763

0.768

0.759

0.758

0.162

0.162

0.020

0.020

0.060

0.060

10.21

10.26

5.33

5.32

0.160

0.154

0.407

0.410

0.099

0.103

Note: Mean with standard errors in parentheses. Difference with t-statistics in parentheses.

Table A3
Robustness check: independence of the results of wealth. Source: Authors calculation based on 2011 LIK survey data.
Probit model, reported are marginal effects
Variables

Give monetary help

Receive monetary help

migrant_hh

0.1132***
(0.0376)
.
.
0.0043***
(0.0014)
0.0878*
(0.0529)
0.1095**
(0.0505)
0.0471
(0.0804)
0.0006
(0.1336)
0.0521
(0.1007)
0.0326***
(0.0093)
0.1270
(0.0871)
0.0095
(0.0069)
0.2035***
(0.0485)

.
.
0.1085***
(0.0406)
0.0043***
(0.0014)
0.0843
(0.0527)
0.1141**
(0.0499)
0.0537
(0.0811)
0.0098
(0.1350)
0.0456
(0.1037)
0.0326***
(0.0095)
0.1276
(0.0866)
0.0099
(0.0068)
0.2001***
(0.0485)

0.0063
(0.0468)
.
.
0.0008
(0.0012)
0.0598
(0.0500)
0.0407
(0.0499)
0.0615
(0.0807)
0.0145
(0.1292)
0.0991
(0.0684)
0.0074
(0.0092)
0.0309
(0.1019)
0.0055
(0.0076)
0.1411**
(0.0644)

.
.
0.0361
(0.0445)
0.0007
(0.0012)
0.0655
(0.0502)
0.0451
(0.0502)
0.0632
(0.0807)
0.0220
(0.1306)
0.0965
(0.0696)
0.0074
(0.0092)
0.0344
(0.1016)
0.0056
(0.0075)
0.1415**
(0.0640)

0.0428
(0.0421)
.
.
0.0001
(0.0015)
0.0443
(0.0689)
0.0317
(0.0673)
0.0386
(0.0999)
0.0009
(0.1210)
0.0826
(0.0997)
0.0642***
(0.0100)
0.2275**
(0.0985)
0.0123*
(0.0069)
0.1130
(0.0847)

.
.
0.0108
(0.0394)
0.0000
(0.0015)
0.0488
(0.0684)
0.0283
(0.0668)
0.0384
(0.1000)
0.0013
(0.1207)
0.0820
(0.0996)
0.0640***
(0.0100)
0.2255**
(0.0988)
0.0122*
(0.0069)
0.1147
(0.0854)

0.0860*
(0.0498)
.
.
0.0040***
(0.0015)
0.1037
(0.0688)
0.2020***
(0.0630)
0.0604
(0.1167)
0.1290
(0.1317)
0.1981
(0.1574)
0.0314***
(0.0103)
0.0588
(0.0930)
0.0076
(0.0080)
0.1043
(0.0854)

.
.
0.0651
(0.0421)
0.0040***
(0.0015)
0.1069
(0.0681)
0.2048***
(0.0621)
0.0632
(0.1176)
0.1276
(0.1322)
0.1967
(0.1600)
0.0316***
(0.0103)
0.0602
(0.0937)
0.0078
(0.0079)
0.1006
(0.0865)

1607
0.236

1607
0.236

1585
0.297

1585
0.297

1375
0.352

1375
0.352

1341
0.341

1341
0.340

remitt_hh
headage
headmale
headmarried
headkyrgyz
headuzbek
headrussian
hhsize
depend
yrs_schooling
anygroupmem
N
Pseudo-R2

Give non-monetary help

Receive non-monetary help

Note: Constant and community xed effects are included. Numbers in brackets are standard errors (adjusted for clustering). The number of observations
varies across the columns and from the total number of sample households because some community xed effects perfectly predict the dependent variable.
*
Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

704

T. Chakraborty et al. / Journal of Comparative Economics 43 (2015) 690705


Table A4
Propensity score estimation: probit regression for migration and remittances. Source: Authors calculation based on 2011 LIK
survey data.
Variables

Dependent: migration

Dependent: remittances

headage

0.0103***
(0.00377)
0.551***
(0.174)
0.574***
(0.195)
0.114
(0.178)
0.292
(0.227)
0.227
(0.370)
0.00344
(0.0226)
0.833***
(0.278)
0.0122
(0.0180)
0.132
(0.154)
0.0167
(0.0568)
0.106*
(0.0555)
0.00426
(0.137)
0.226*
(0.131)
0.016
(0.212)

0.0107***
(0.00416)
0.580***
(0.153)
0.501***
(0.174)
0.148
(0.186)
0.0907
(0.200)
0.0404
(0.357)
0.00965
(0.0223)
0.554**
(0.240)
0.0245
(0.0178)
0.315*
(0.185)
0.0551
(0.0622)
0.0651
(0.0568)
0.0494
(0.135)
0.348***
(0.117)
0.139
(0.216)

1652
0.155

1652
0.145

headmale
headmarried
headkyrgyz
headuzbek
headrussian
hhsize
depend
yrs_schooling
anygroupmem
wealth_index
headrisk
headagri
headnonagri
headmobility
N
Pseudo-R2

Note: Constant and province (oblast) xed effects are included. Numbers in brackets are standard errors (adjusted for
clustering).
*
Signicant at 10%.
**
Signicant at 5%.
***
Signicant at 1%.

Table A5
Summary of matching quality. Source: Authors calculation based on 2011 LIK survey data.
Before matching

After matching

Migration
Mean standardized bias
Median standardized bias
Pseudo-R2

14.0
13.1
0.069

1.0
1.0
0.001

Remittances
Mean standardized bias
Median standardized bias
Pseudo-R2

12.8
11.3
0.052

1.3
0.8
0.001

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