Do remittances support consumption during crisis? Evidence from Kosovo.

Summary This paper focuses on the effect of remittances on per capita consumption over time in a context of conflict , war-to-peace transition and crisis. We use two household surveys from Kosovo with unique timing , one collected immediately after the civil war in 2000 and the other during the economic crisis in 2010. This territory , in which the tension among ethnic groups is the focus of international concern , is one of the top remittance-­‐receiving countries in the world. We examine the effect of remittances not only at the average level of consumption , but also at various parts of the distribution of consumption using quantile regressions. We find that remittances alleviate poverty by enhancing the consumption level of the most vulnerable households , and the positive effect of remittances on consumption has remained constant between 2000 and 2010. This result may be connected with the resilience of remittances.