Private Income Transfers and Development: Three Applied Essays on Latin America

For decades, economists have been interested in studying why and how agents support each others, giving a special place to the analysis of private income transfers. Recent applications include very diverse topics such as: the analysis of capital accumulation, social cohesion and solidarity, market insurance and interest rates, risk-coping strategies against negative shocks and government policies. The present dissertation analyzes how inter-household transfer decisions, international remittances and intra-household transfers contribute to shape five fundamental aspects of development: (i) social interactions, (ii) market and household work, (iii) spending patterns, (iv) nutrition and (v) health. Three research questions are addressed using applied data from Colombia, Ecuador and Peru, and multiple econometric techniques. First, is there a relationship between inter-household transfer dynamics and distance between donors and receivers? Second, do remittances asymmetrically shape labor supply responses depending on people’s characteristics? Third, do intra-household transfers influence spending patterns, nutrition and health outcomes? Results suggest that private income transfers play a key re-distributive role, shaping agents’ living standards and improving individual and social well-being. In contexts of economic deprivation, where social safety nets are scarce, informality is at stake, institutions are highly fragmented and the public sector is weak, money and in-kind help from other households or individuals constitute crucial livelihood strategies to get through the economic world. Thus, enhancing our understanding of this dimension of social behaviors is a must.

Keywords : Private income transfers; Time allocation and labor supply; Remittances; Personal Income, Wealth, and Their Distributions; Altruism; Children; Economics of the Elderly; Health and Economic Development; Provision and Effects of Welfare Programs.