Remittances and relative concerns in rural China

• The paper investigates the impact of remittances on the relative concerns of households in rural China. Using the Rural to Urban Migration in China (RUMiC) dataset we estimate a series of subjective well-being functions to simultaneously explore relative concerns with respect to income and remittances. Our results show that although rural households experience substantial welfare loss due to income comparisons, they gain well-being by comparing their remittances with those received by their reference group. In other words, we find evidence of a "status effect" with respect to income and of a "signal effect" of similar magnitude with respect to remittances. This finding is robust to various specifications, alternative reference group definitions, controls for the endogeneity of remittances and selective migration, as well as the use of migrants' net contribution to household income.

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business (hsv//eng)

Nyckelord

Positional concerns

Remittances

Subjective well-being

to-urban migrants

experienced utility

income-distribution

positional

concerns

panel-data

happiness

inequality

life

determinants

satisfaction

Business & Economics

Publikations- och innehållstyp

ref (ämneskategori)

art (ämneskategori)