How do remittances impact child mortality and are there preconditions?

Abstract

While recent research suggests that remittances affect child mortality, little is known about how remittances influence this outcome and what conditions may moderate its effectiveness. This article investigates whether and how remittances affect child mortality in developing countries. We examine the impact of remittances on the three leading causes of child mortality, explore potential channels through which this may occur and examine whether socioeconomic or political factors affect the remittances-mortality relationship. Using data for 122 developing countries over the period 2003–2018 and a dynamic panel estimator, with both internal instruments and a shift-share external instrument, we find that remittances reduce child mortality from diarrheal diseases. Our findings suggest that sanitation usage is a possible channel through which remittances affect diarrheal mortality. We also find that the mortality-reducing effect of remittances does not appear to be contingent on the level of governance or health infrastructure. However, it remains unclear whether the effect is influenced by other forms of health funding. These findings suggest that remittances serve an important role in improving child health, and the effectiveness of these inflows is not reliant on onerous preconditions being met. Thus, remittances may be important to public health dialogue, especially in developing countries where diarrheal diseases are prevalent.