Measuring Remittances using Multi-Purpose Household Surveys: the LSMS experience Gero Carletto Development Research Group The World Bank (with Claudia Rodriguez)

What is an LSMS? DISTINCTIVE FEATURES  Multi-Topic Questionnaire  Multiple Instruments  Consumption-based welfare measure  Quality Control  Demand-driven

Main objectives of LSMS Surveys  Measuring and Monitoring Welfare  Poverty and policy analysis  Capacity building  Methodological validation (LSMS IV)  Consumption, subjective poverty, migration, …  Income (remittances)

Review: main methodologies  Transfer/remittances module Household (total transfer; by recipient) Individual (remitter)  Other income HH level Closed vs. open  Individual migrant’s rosters  Combination

Individual level transfers (Nepal 2002/03)

Other Income, HH level (Vietnam 2004)

Individual migrant’s rosters  GHANA LSS 2005/06, ALBANIA LSMS 2005, BULGARIA MTHS 2007 Current household members  Present (past migration)  Absent Former Household members Other individuals

No. of surveys With remittance information 68 Unable to differentiate bet/w domestic and int'l remittances 19 No remittance information 4 Total 91 Most survey contain some remittance info …

Large heterogeneity in methods … MethodNo.% Transfers/ Remittances (Indiv. level) Transfers/ Remittances (HH level)811.8 Individual level (migrant roster)45.9 Other income Other (social protection)34.4 TOTAL

Some differences in reference periods No. of surveys% Last 12 months Last year34.4 Last 14 months11.5 Last 6 months34.4 Last 3 months11.5 Last 30 days11.5 Multiple57.4 Flexible57.4 Total

Country X, 2004

Country X, 2004 (cont’d)

Country Y, 1997

Any improvements over time?  Albania  Bulgaria  BiH  Ghana  Nicaragua  Vietnam

CountryMethodology % HHs w/ remittances Vietnam 1992 Individual level remittances5.0 Vietnam 1997 Individual level remittances6.0 Vietnam 2004 Other income (HH level)5.0

BoP vs. survey estimates

Bulgaria MTHS 2007 (Sample: 4,300 HHs) Current HH members (1) Former HH members (2) Other income module (3) (2)+(3) HH with migrants205*458 HH with migrants sending remittances Average remittances received by HH (yearly) ??? U$2,186US$779US$1,993

Conclusions  Most surveys contain info on remittances but … Little consistency in methodology Often different components and groups of individuals included Ambiguities and double counting “Large” underestimation? Lack of benchmark!  Some progress, but … Limited to few countries: demand-driven?? Shortage of best practices

Conclusions (cont’d)  Reference period: 12 months (?)  Importance of placement (?)  Individual vs. household-level  HH membership  Distinguish transfers from abroad  Multiple modules  Temporary migrants and returnees: info (last 12 months) on country of work, length of spell abroad, occupation, wages  De-coupling remittances from migration???