The Impact of Remittances Versus Parental Absence on Children’s Wellbeing: Evidence from Rural Punjab

Abstract

This study examines the impact of migration on children left behind in terms of schooling and child labor by quantifying two aspects of migration: remittances and parental absence, in cases where the father is the migrant. The study is based on a panel analysis of data drawn from the Multiple Indicator Cluster Survey for 2007 and the Privatization in Education Research Initiative survey for 2011. The sample comprises 820 households with children aged 5–14 years. The study uses the instrumental variable (IV) approach due to endogeneity. Exogenous variation in parental absence and remittances sent by migrants from a given kinship network are employed as IVs. This, combined with household fixed effects and random effects, increases the reliability of the results. While remittances benefit the children, father’s absence has adverse consequences for them. However, mother’s presence in the house appears to compensate for the father’s absence, making the migration beneficial on net for the child. The father’s absence has worse consequences for girls in terms of increased child labor, where the money coming in through remittances has a larger impact on boys’ schooling.