Remittances and subjective well-being: A static versus dynamic panel approach to happiness

Authors

DOI:

https://doi.org/10.59670/ml.v18i6.917

Keywords:

East Central Europe, welfare state, welfare regime, hierarchical cluster analysis

Abstract

Using all five waves of the National Income Dynamics Study (NIDS) panel dataset, we examine the effect of domestic remittances on the static and dynamic subjective well-being (SWB) of recipient individuals in South Africa, by using a random effects ordered probit model that accounts for individual heterogeneity. Moreover, we check the robustness of our static model results by making use of an instrumental variable for migrants’ remittances. Two major empirical findings emerge from this paper: firstly, domestic remittances are consistently found to have a positive and statistically significant impact on the happiness of recipient individuals. Moreover, this finding persists in both the static and dynamic panel models. Secondly, the coefficient on lagged SWB (derived from the dynamic model) is found to be positive and statistically significant, confirming that SWB today is significantly influenced by SWB in the past.

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Author Biographies

Mduduzi Biyase, University of Johannesburg

Senior Lecturer

School of Economics

College of Business and Economics

University of Johannesburg

Bianca Fisher, University of Johannesburg

Postgraduate Student

School of Economics

College of Business and Economics

University of Johannesburg

Marinda Pretorius, University of Johannesburg

Senior Lecturer

School of Economics

College of Business and Economics

University of Johannesburg

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Published

2021-11-30

How to Cite

Biyase, M., Fisher, B., & Pretorius, M. (2021). Remittances and subjective well-being: A static versus dynamic panel approach to happiness. Migration Letters, 18(6), 761 –. https://doi.org/10.59670/ml.v18i6.917

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