The impact of remittances and gender on household expenditure patterns: Evidence from Ghana

Abstract

The overall objective of this paper is to explore the relation between gender and remittances. Building on the adjusted Working-Leser curve, we use the nationally representative Ghana Living Standard Survey 1998/99 to investigate how the sex of the household head and remittances affect the household budget allocations, as well as how the sex of the remitter affects these allocations. The results indicate that the sex of the household head and whether or not the household receives remittances both separately and jointly affect household expenditure allocations. Consistent with findings from the intra-household bargaining literature, we find that female-headed households spend a larger percentage of expenditures on food and education and a lower percentage on consumer and durable goods, housing and other goods. When headship is interacted with receipt of remittances from abroad or from within Ghana, more interesting results emerge; controlling for expenditure differences between female and male-headed households, we find that female-headed households that receive international remittances spend a lower share of their budgets on food and a greater share on consumer and durable goods, housing and other goods than do femaleheaded households that not receive these remittances. We find that the sex of the remitter is a significant determinant of the household’s expenditure pattern only when we control for the remitter’s ability to monitor how the remittances receiving household allocates its resources. Once these factors are controlled for, households that receive remittances from female remitters (as opposed to male remitters) allocate a larger expenditure share to spending on health and other goods, but a lower share on food. Based on these results, we conclude that the literature on remittances would benefit from including a gender analysis.