Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/73839 
Year of Publication: 
2012
Series/Report no.: 
ifo Working Paper No. 137
Publisher: 
ifo Institute - Leibniz Institute for Economic Research at the University of Munich, Munich
Abstract: 
Empirical evidence that migrants send home more remittances after disasters raises the question of whether remittances are used to self-insure, substituting for both formal and informal insurance. We investigate this question using a unique dataset on the usage patterns of financial services by households in South Africa. We show that the likelihood that a respondent has a formal funeral cover increases with income and banking status. However, it is lower for individuals receiving remittances, which supports the idea that remittances act as self-insurance. We also show that other risk management strategies influence the purchasing of formal funeral cover. Finally, we find that determinants of informal insurance differ from those of formal insurance.
Subjects: 
Remittances
insurance
risk management strategies
JEL: 
D14
F24
G22
O16
Document Type: 
Working Paper

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