Revisiting the Impact of Migration and Remittance to Poverty Reduction

Abstract

however, none of these studies could explain the broken remittance-poverty reduction nexus of the Philippine case. This study diagnosed the Philippines poverty problem by focusing on the countrys livelihood conditions using the Sustainable Livelihood (SL) framework. A two-stage approach of analysis was used to answer this researchs main question. In the first analytical stage, a statistical regression covering 72 developing countries for the period 1990-2010 was employed to test the significance of remittance, agricultural value-added per worker and non-agricultural value-added per worker to poverty rate. With the assumption made that these variables-of-interest are good-enough proxies to each of the livelihood option (i.e., international migration livelihood option, domestic agricultural livelihood option and domestic non-agricultural livelihood option, respectively), the second stage of analysis assessed the extent of Philippine government support to the livelihood options. It was found that international migration and domestic agricultural livelihood options are both significant in reducing poverty. Examination of support to these livelihood options revealed that the Philippine government fully supported the international migration livelihood option while falling short in support for domestic agricultural livelihood. These findings are consistent with ADBs diagnosis of the Philippine poverty problem, i.e., it is rural in nature with chunk of the poor in the agriculture sector.

In 2009, The Asian Development Bank (ADB), along with other scholars who studied Philippine poverty, remarked that poverty is a perennial problem within and of the country. On a lighter side, the Philippines performed well in terms of migration (9th biggest emigrating country in the world for 2010) and remittance (4th biggest remittance-receiving country in the world for 2010). Studies suggest that remittance has poverty-reducing effect