Innovations for Poverty Action (IPA) and researchers from the University Michigan and Sapienza University of Rome are running a project to study the impact of providing migrant workers improved ability to control and direct their remittances for specific uses. The participants in this study are Filipino workers living in Dubai and Sharjah in the United Arab Emirates (UAE). The Philippines is a notable recipient of remittances: in 2017 its citizens received about US$33 billion—the third-highest amount in the world after India and China.
The project team is comprised of a partnership between academics with migration/remittance expertise, and the financial institution UAE Exchange. The academic team has previously collaborated on a lab-in-the-field experiment in Rome, where they tested approaches to increase Filipino migrants’ remittances for education. They found that simply providing migrants an ability to label (in a non-binding way) remittances for education raised total remittances by 15%. The project builds on this previous research and aims to analyse the impact of providing the option of labelled remittances to Filipino workers in the UAE on the amount of remittances sent and what those remittances are used for by their recipients. In 2017, GIF invested in randomized evaluations of the impacts of a real-world version of the remittance labelling product, relating to both the changes in remittance behaviour of the migrants, and changes in spending patterns and life outcomes of the recipient households.
Use of GIF Funds
The GIF grant initially funded two evaluations, one focused on Filipino migrants in the UAE and their households in the Philippines, and another focusing on South Pacific Islander migrants working in Australia. In response to the Covid-19 pandemic and due to disruption from the pandemic, funds were redeployed from the South Pacific Islander component of the study to new survey work related to COVID-19. This new survey work seeks to understand whether remittance labelling brings additional benefits by enhancing the role of remittances in coping with the COVID-19 crisis. The use of GIF funds of $1,596,921 is as follows:
- $1,518,421to conduct an RCT in the UAE and the Philippines to test the impacts of a real-world version of the remittance labelling product, relating to both the changes in remittance behaviour of the migrants, and changes in spending patterns and life outcomes of the recipient households
- $78,500to complete an endline COVID-19 survey in the UAE and the Philippines, write-up of results and submission for publication of the COVID-19 survey
Partner with UAE Exchange to design and pilot a remittance product incorporating behavioural nudges. Conduct a randomized evaluation of the Philippines-based remittance product to evaluate both the changes in remittance volumes sent by migrants and corresponding socioeconomic impacts on receiving households. Support the Philippine COVID-19 response by quantifying the role of international migrant remittances in helping households cope with the pandemic’s economic consequences and investigate how these responses are affected by the remittance labelling innovation.
Impact to Date
Over 4,000 migrants were enrolled in the study as well as their primary remittance recipients. The study found that the ability to label remittances with the migrant’s intended uses led migrants with low base levels of remittance activity to increase their remittance levels. For migrants who had higher remittance base levels, there was no change in their remittance behaviours. The final results of the study are yet to be published. Work on theCOVID-19 survey is ongoing and results and yet to be determined.