Strike Mbulawa



The study focuses on household welfare in the context of Southern Africa Development Community (SADC) against the background that few studies have addressed this issue despite its importance in policy making. Past studies have failed to explain the impact of remittances on household welfare throughout the different distribu-tions. The study aimed to: (1) establish the key determinants of household welfare and explain how they behave across different quantiles (2) discuss the substitutability between remittances and FDI as drivers of household welfare. The study employs panel data (1975-2014), conditional quantile regression and panel least squares approach. Findings support altruistic motives in explaining workers’ and recipients’ behavior at first while the portfolio approach dominates their behavior at higher levels of the distribution. The study confirms the trade openness led welfare hypothesis and the remittance led welfare hypothesis. The flow of remittances and FDI are substitutes when considered as sources of improved welfare. The paper provides policy implications for improving household welfare.


Household welfare; SADC; Remittances; FDI; Quantile regression

Full Text:



Abbas, K, Sabir, H, M, Shehzadi, A. and Abbas, Q. (2014) ‘Impact of worker remittances on household welfare in District Jhang: A case study of Tehsil 18 Hazari’, Journal of Finance and Economics, 2(4), pp. 131-135.

Agarwal, M. and Atri, P. (2015) ‘Foreign direct investment and poverty reduction: India in regional context’, Regional and Information System for Developing Countries, Discussion Paper No. 200

Akanle, O. and Adesina, J, O. (2017) ‘Remittances and Household welfare in Nigeria’, African Population Studies, 31(1), pp. 37-48.

Andersson, L. (2014) ‘Migration, remittances and household welfare in Ethiopia’, United Nations University, Working Paper Series, 2014-004.

Anghel, R, G, Piracha, M. and Randazzo, T. (2015) ‘Migrants’ remittances: Channeling globalization’, IZA Discussion paper No. 9516.

Assaminew, E, Ahmed, G, Aberra, K. and Makonnen, T. (2010) International Migration Remittances and Poverty Alleviation in Ethiopia, Ethiopian Economics Association, Working Paper No. 1

Awan, M, S, Javed, M. and Waqas, M. (2015) “Migration, remittances and household welfare: Evidence from Pakistan”, The Lahore Journal of Economics, 20(1), pp. 47-69.

Beyene, B, M. (2012) The effect of international remittances on poverty and inequality in Ethiopia, Memorandum, Department of Economics, University of Oslo, No. 13/2012. Available at: [Accessed on 30 June 2017]

Biyase, M. (2012) The relationship between poverty and remittances in South Africa, Strategies to overcome poverty and inequality, Towards Carnegie III, University of Cape Town, 3 – 7 September.

Bollard, A, McKenzie, D, J. and Morten, M. (2010) ‘The Remitting Patterns of African Migrants in the OECD’, World Bank Policy Research Working Paper No. 5260. Available at SSRN: [Accessed on 12 June 2017]

Borci, A. and Gavoci, M. (2015) “The impact of remittances on households well-being: Evidence from Albania”, International Journal of Economics, Commerce and Management, III(11), pp. 80-103.

Christiaensen, L, Demery, L. and Paternostro, S. (2002) Growth, Distribution, and Poverty in Africa: Messages from the

s. World Bank Policy Research Working Paper No. 2810. Available at SSRN:

Cisse, F. and Fofana, I. (2013) The growth and poverty impact of the West African Free Trade Agreement with the European Union, CRES. Available at: [Accessed on 12 June 2017]

Cockburn, J, Decauluwe, B. and Robichaud, V. (2006) Trade liberalization and poverty: Lessons from Asia and Africa. [Accessed on 12 June 2017]

Cockburn, J, Corong, E, Decaluwe, B, Fofana, I. and Robichaud, V. (2010) The gender and poverty impact of trade lib-eralization in Senegal, CIRPEE, Working Papers 10-13.

Deaton, A. and Grosh, M. (2000) ‘Consumption’, Chapter 5 in M. Grosh and P. Glewwe (eds.), Designing Household Survey Questionnaires for Developing Countries: Lessons from Ten Years of LSMS Experience, Washington, DC: World Bank.

Deaton, A. and Zaidi, S. (2002) ‘Guidelines for Constructing Consumption Aggregates for Welfare Analysis’, World Bank LSMS Working Paper 135.

De, P, K. and Ratha, D. (2012) “Impact of remittances on households income, asset and human capital: Evidence from Sri Lanka”, Migration and Development, 1(1), pp. 163-179.

de Acade, R, de Vicente, S, Mahia, R. and Medina, E. (2014) ‘Trade liberalization and poverty reduction in Africa: Computable general equilibrium models approach. Literature Review’, International Journal of Political Science and Development, 2(5), pp. 90-96.

Donkoh, S, A, Alhassan, H. and Nkegbe, P, K. (2014) “Food expenditure and household welfare in Ghana”, African Journal of Food Science, 8(3), pp. 164-175


  • There are currently no refbacks.