Who You Train Matters: Identifying Complementary Effects of Financial Education on Migrant Households

42 Pages Posted: 20 Apr 2016  

Yoko Doi

affiliation not provided to SSRN

David J. McKenzie

World Bank - Development Research Group (DECRG); IZA Institute of Labor Economics

Bilal Zia

World Bank - Development Research Group (DECRG)

Date Written: August 1, 2012

Abstract

There has long been a concern among policymakers that too much of remittances are consumed and too little saved, limiting the development impact of migration. Financial literacy programs have become an increasingly popular way to try and address this issue, but to date there is no evidence that they are effective in inducing savings among remittance-receiving households, nor is it clear whether such programs are best targeted at the migrant, the remittance receiver, or both. The authors conducted a randomized experiment in Indonesia which allocated migrants and their families to a control group, a migrant-only training group, a family member-only training group, and a training group in which both the migrant and a family member were trained. Three rounds of follow-up surveys are then used to measure impacts on the financial knowledge, behaviors, and remittance and savings outcomes of the remaining household. They find that training both the migrant and the family member together has large and significant impacts on knowledge, behaviors, and savings. Training the family member alone has some positive, but smaller effects, whilst training only the migrant leads to no impacts on the remaining family members. The results show that financial education can have large effects when provided at a teachable moment, but that this impact varies greatly with who receives training.

Keywords: Financial Literacy, Access to Finance, Education For All, Access & Equity in Basic Education, Primary Education

Suggested Citation

Doi, Yoko and McKenzie, David J. and Zia, Bilal, Who You Train Matters: Identifying Complementary Effects of Financial Education on Migrant Households (August 1, 2012). World Bank Policy Research Working Paper No. 6157. Available at SSRN: https://ssrn.com/abstract=2127057

Yoko Doi (Contact Author)

affiliation not provided to SSRN

No Address Available

David John McKenzie

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Bilal Zia

World Bank - Development Research Group (DECRG) ( email )

MC3-445
1818 H Street, N.W.
Washington, DC 20433

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