Remittance income uncertainty and asset accumulation

IZA Journal of Labor & Development

Table 7 Instrumental variable two part model for share of households’ expenditures on human, physical and financial assets

Variables	First part				Second part
Variables	Coefficient	Robust S.E.	M.E. on Prob (Y > 0)	Robust S.E.	Coefficient/M.E. on E(Y\|Y > 0)	Robust S.E.
HH remittance income (1,000 pesos)	0.013***	0.002	0.003***	0.001	0.004	0.003
Remittance income volatility	0.070**	0.031	0.017**	0.007	0.070**	0.029
Female headed HH	−0.017*	0.010	−0.004*	0.002	0.004	0.011
Number of young children in the HH	0.010	0.006	0.002	0.002	−0.031***	0.006
Number of elderly HH members	−0.100***	0.007	−0.024***	0.002	−0.028***	0.007
Number of HH members with high school or above	0.105***	0.006	0.025***	0.001	−0.021	0.019
Number of HH members with middle school	0.071***	0.004	0.017***	0.001	0.014	0.008
Number of HH members employed	−0.012***	0.005	−0.003***	0.001	−0.038***	0.007
HH Income excluding remittances (in 1,000 pesos)	0.002***	1.5E-04	0.001***	4.0E-05	0.001***	1.9E-04
Uncertainty of HH income excluding remittances	0.002	0.011	4.1E-04	0.003	0.122***	0.030
Household size	0.051***	0.003	0.012***	0.001	0.033***	0.004
Rural household	−0.123***	0.010	−0.030***	0.003	0.088***	0.024
Year fixed-effects	Yes				Yes
Mexican state fixed-effects	Yes				Yes
Mexican state-level time trends	Yes				Yes
Observations:	159,523				125,992
Significance	Wald Chi2 = 31,488.69 with Prob > Chi2 = 0.000				R-squared = 0.112

Notes: ***Significant at the 1 percent level or better, **significant at 5 percent level or better and *significant at the 10 percent level or better. All regressions include a constant term. Standard errors are clustered at the Mexican state level. Marginal effects are evaluated at the mean.