REMITTANCE AND ITS IMPACTS ON POVERTY REDUCTION OF NEPAL
REMITTANCE AND ITS IMPACTS ON POVERTY REDUCTION OF NEPAL
초록/요약
Since 1996, Nepal and its people had been suffering from a scale of distress and agony due to a violent insurgency unleashed by the Maoists. The difficult situation inside the country has retarded growth of its economy and obstructing the efforts towards the poverty alleviation. As a result of 12 years Maoist insurgency, the nation’s economy is almost reached in very critical situation. With 31 per cent of the total population living below the poverty line and major exporting of goods like garment, carpet and pashmina are declining the only sector that is sustaining the nation’s economy is the remittances generated from Nepalese labor force working abroad. According to the National Planning commission (NPC) the number of overseas workers has grown by 30 percent in last couple of years making remittance as the single largest foreign exchange earning sector. This shows how importance is remittance to the nation’s economy and for poverty alleviation. With larger income gaps and opportunities between rich and poor countries, labor migration has increased, and so have remittances from international labor migrants. Since remittances are an important source of income and have played significant role in poverty reduction in most of the developing countries around the globe, there is a need for studies that address effects of remittances on the receiving economy. The objective of this thesis is to study the impacts of remittances on poverty in Nepal, one of the remittance receiving countries of the world. The study is mainly based on data from the two survey titled “Nepal Living Standards Survey 1994/95 & 2003/04”. It is found that remittances contribute significantly to lower the poverty levels in Nepal.
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1. INTRODUCTION 1
1.1 METHODOLOGY 3
1.1.1 Concepts 3
1.1.2 Methodology and Limitation 3
1.1.3. Disposition 4
2. THEORITICAL BACKGROUND 5
2.1 MIGRATION THEORIES 5
2.2 REMITTANCES THEORIES 6
2.2.1 Motives to Remit 7
2.2.2 Determinants of Remittances 8
2.3 THE IMPACTS OF REMITTANCES ON POVERTY: EMPIRICAL EVIDENCE 8
3. ECONOMY, MIGRATION AND REMITTANCES IN NEPAL 11
3.1 ECONOMIC STRUCTURE 11
3.2 MIGRATION 12
3.2.1 Migration History 13
3.2.2 Migrant Motives 14
3.3 REMITTANCES 14
3.3.1 Remittances channels 15
3.3.2 Overview of remittance transfer methods in Nepal 15
3.4 REMITTANCES FLOWS 16
3.5 REMITTANCES AND OTHER SOURCES OF FOREIGN EXCHANGE 17
3.5.1 Comparisons of Remittances and Foreign Direct Investment 18
3.6 DETERMINANTS 18
3.7 USE OF REMITTANCES 19
4. POVERTY, MEASUREMENT AND INCOME INEQUALITY IN NEPAL 20
4.1 DEFINING POVERTY 20
4.1.1 Income and Non-income Poverty 20
4.1.2 Absolute and Relative Poverty 20
4.1.3 Measurement of Poverty 20
4.2 POVERTY SCENARIO OF NEPAL 21
4.2.1 Rural and urban poverty 22
4.2.2 Regional poverty 23
4.3 INCOME INEQUALITY 25
5. REMITTANCES AND POVERTY. 28
5.1 REMITTANCES AND HOUSEHOLD INCOME 28
5.1.1 Share of Remittance as a Source of Household Income 29
5.1.2 Rural and Urban Area: Remittance and Income 29
5.1.3 Remittances and Income in Development Regions 31
5.2 DISTRIBUTION OF REMITTANCES 31
5.3 REMITTANCE AND ITS IMPACT ON NATIONAL LEVEL 33
5.4 REMITTANCES AND POVERTY PATTERNS. 34
5.4.1 Urban Patterns 34
5.4.2 Rural Patterns 35
5.4.3 Development Regions Patterns 35
5.5 REMITTANCES AND INEQUALITY 36
6. CONCLUSION AND RECOMMENDATIONS 38
REFERENCES 40
