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Educational Expenditure and Remittances: Is There a Link?

Are transfers from members living abroad a stimulus to a key sector such as schooling in Albania? In the present article I summarize results of a study investigating which factors are able to boost the household expenditure in education. Among these factors, a large emphasis is given to the amount of remittances sent to Albanian families from migrants living abroad. High rates of unemployment and the severe poverty in Albania have induced strong migration pressures. These large migration flows provide Albania with an important source of capital in terms of external remittances. The two main empirical findings are that the household income has a positive and well determined impact on education expenditure, whereas international transfers do not influence education spending.