Household inequality and remittances in rural Thailand: a life-cycle perspective

Abstract

This article studies the dynamics of income inequality among a panel of rural households in Thailand. In contrast to the many cross-section studies of income inequality, the article exploits a long panel data set to examine lifetime trajectories of household inequality. It finds that income inequality is decreasing over time within cohorts delineated by decennial birth dates of heads of household. This decline in inequality primarily arises from differences in receipt of remittances from adult children of the head of household who live outside the village of origin. On average, poorer households receive remittances from a larger number of children, the annual amount remitted per child is a greater proportion of household income than in richer households, and the importance of remittances in household incomes grows as the head of household ages.