Impacts of remittances from internal and international migrants on poverty and inequality in Mali

Abstract

This paper aims at assessing the impact of remittances from internal and international migrants on the level of poverty and inequality in Mali. The estimation results show that, at the national level, international remittances and their combination with internal remittances are associated with a decline in all poverty indicators (incidence, depth, and severity of poverty) in contrast with internal remittances only which reduce the severity of poverty but lead to an increase in the incidence and the depth of poverty. All these categories of remittances considered exert a negative effect on all poverty indicators in rural areas, while internal remittances tend to exacerbate poverty and inequalities in urban areas. The analysis of more relevant indicators for measuring the level of inequality, in this case the Gini coefficients and expenditure percentiles for the various counterfactuals, shows that remittances have an equalizing effect on the distribution of consumption expenditure per capita, on the one hand, and that this effect is driven more by internal remittances, on the other hand. This last result is essentially explained by the fact that populations in urban areas, because of their attachment to their locality of origin, ration their income to meet the needs of their families who have remained in rural areas.