Balancing requests, ‘wants’ and ‘needs’
Remittances, migration goals, decision-making and development of
migrant households in Bacolod City, the Philippines
Babette Schilte UvA ID: 10645942
Master Thesis University of Amsterdam Contemporary Asian Studies Graduate School of Social Sciences
Supervisor: Dr. Rosanne Rutten Second reader: Prof. Dr. Mario Rutten
Amsterdam, June 19th2014 babette.schilte@gmail.com
‘The sacrifice and hardship we make is in preparation of our future’
Summary
The relation between migration and development is still ‘unsettled’ (Martin and Papademetriou, 1991: 218). Although remittances and migration potentially lead to development, specific political, economic and social circumstances in the sending and receiving countries determine to what extent this is the case (De Haas, 2005: 1275). Therefore, it seems to be more relevant to study under which circumstances migration does and does not lead to development and to look for explanations. There seems to be a gap in existing knowledge on what migrants and their household members themselves consider as desirable development because scholars often focus on factors that contribute to development on a macro-level. To reduce this gap of knowledge, this research focuses on the goals of migration of migrant households, what they see as desirable development themselves, and the achievement of these goals. These micro-level results could contribute to other studies on the effects of migration on development on a macro-level, because the sum of individual decisions will result in macro-level outcomes (Schelling, 1978 in: Haug, 2008: 586). The research focuses on household decision making, migration goals and the use of remittances in migrant households with children in Bacolod City, the Philippines. Specific circumstances in and outside of the household and personal characteristics of household members will be used to explain success and failure of households to achieve migration goals. Data of this research shows that most of the couples use part of the remittances for investments and their standard of living has improved. Therefore, this research did not confirm the ‘pessimist’ view on the link between migration and development. However, some spouses disagreed or were unable to budget and save money and were less successful in making productive investments. Whether or not migration has positvie effects on social and economic development on the household level depends on a few factors. The capability to budget money and make plans for the future proved to be influencing success strongly. If couples were able to
distinguish ‘wants’ and ‘needs’ and if they knew how to cope with requests and expectations from relatives, this helped them to keep to their budget planning and to achieve goals. Other factors that seem to lead to success are cooperation between spouses, diversification of income sources, working with one goal at a time, strong family ties within the conjugal household and considering the
remittances as a temporary source of income. The situation in the Philippines influences how couples look at development and how they use remittances. The decisions of the couples eventually
Table of contents Page Acknowledgements………..4 Chapter 1 Introduction………...5 1.1 Introduction……….…5 1.2 Theoretical framework……….…..6
1.3 Migration and the household in the Philippines……….10
1.4 Context……….….11
1.5 Setting…….………..…12
1.6 Methodology……….….13
Chapter 2 General characteristics of the migrant household members and goals of migration.………15
2.1 Introduction………..15
2.2 General characteristics……….….15
2.3 Occupations of the OFWs and their spouses……….19
2.4 Destinations of OFWs………..20
2.5 Housing of informants……….21
2.6 Reasons to go abroad and goals of migration………22
2.7 Conclusion………..27
Chapter 3 Use of remittances………..28
3.1 Introduction………28
3.2. Remittance recipients………28
3.3 Use of the total household income…..………29
3.3.1 ‘Productive’ and ‘non-productive’ use of remittances………..30
3.3.2 The use of the total household income in Bacolod City……….31
3.4 Investments………34
3.5 Savings………36
3.6 Pasalubong and celebrations……….36
3.7 Helping out relatives………38
3.8 Decision-making………..38
3.9 Conclusion………..41
Chapter 4 Case studies………..43
4.1 Introduction………43
4.2 Angel and Juan Lopez: When dreams and goals turn into debts, loans and quarrels…………..43
4.3 Roberto and Lucy Lacson: Living a comfortable life at preset with an insecure future.……….45
4.4 Isabel and Ignacio Cruz: A financially stable household due to a thrifty seafarer and a determined wife ………47
4.5 Discussion.………..50
Chapter 5 Achievement of migration goals……….53
5.1 Introduction………53
5.2 Failed or adjusted goals of migration………54
5.3 Goals of migration that are not yet achieved……….56
5.4 Achieved goals of migration………57
5.5 Conclusion………58
Chapter 6 Conclusion………..………61
Acknowledgements
I would like to thank Sally May and Claudio, my host family and everyone from stichting Anak
Filipijnen for all their efforts to help me with my research. Especially Nona, Stephanie and Nadin have
helped me tremendously with my research. I trust that everybody who has helped me will know to whom I am referring in particular, but I chose not to mention family names to guarantee anonymity of my informants. I would also like to thank Dr. R. A Rutten for all her feedback and positive support before, during and after my fieldwork. Her enthusiasm and experience have inspired me a lot to do more research on the Philippines. Finally, I would like to thank Gemma, Guido, Jessie, Norman, Ailene, Peachy, Irene and many others for making my stay in the Philippines an unforgettable experience. It really is ‘more fun in the Philippines’.
Chapter 1 Introduction 1.1 Introduction
Migration is undoubtedly one of the most studied and discussed topics of today. Given the
widespread attention that is devoted to migration in and outside the academic realm, it is surprising how much we still have to learn about the effects migration might have on several domains within national societies and on the international community. With almost ten percent of the total population living and working abroad, the Philippines is ‘the largest organized labour exporting country in the world’ (Agunias and Ruiz, 2007: 2). Over ten million Filipinos were living abroad in 2012, of which almost half were temporary workers who were expected to return (Bureau of Labor and Employment Statistics, 2013). During previous years, this number has been rising constantly and expectations are that the number of Overseas Filipino Workers (OFWs) will continue to increase. This makes the Philippines an interesting country for those who study migration and this research also focuses on the Philippines.
International organizations such as the World Bank and the Inter-American development bank
used to be leading bodies in promoting remittances, money that is sent home by migrants, as a tool for development in sending countries (Covarrubias and Wise, 2009: 85). Opinions were mostly optimist during the 1950s and 1960s, with hope that migration would lead to economic development through poverty reduction, growth, increases in human capital and increased consumption
possibilities. Pessimism prevailed during the 1970s and 1980s and scholars argued remittances are mostly being used for (conspicuous) consumption and that migration increases inequalities. From the 1990s onwards, the opinions have become more nuanced and international organizations became more cautious in considering migration and remittances as a tool for development (De Haas, 2007). In short, the relation between migration and development remains ‘unsettled’ (Martin and Papademetriou, 1991: 218).
‘Migration and remittances can potentially contribute to development, but the specific political, economic and social circumstances in both the sending and receiving countries determine the extent to which this potential is exploited’ (De Haas, 2005: 1275). It thus seems to be more relevant to study under which circumstances migration does and does not lead to development and to look for explanations. There seems to be a gap in existing knowledge on what migrants and their household members themselves consider as desirable development because scholars often focus on factors that contribute to development on a macro-level. Therefore, this research focuses on the goals of migration of migrant households and the achievements of these goals. These goals are considered to be a reflection of what couples see as desirable development of their household.
Studying micro-level decision-making can enhance our understanding of macro-level structures, because the sum of individual decisions will result in macro-level outcomes (Schelling, 1978 in: Haug, 2008: 586). Therefore, this research focuses on the specific circumstances within and around households that help explain the success and failure of households to reach economic prosperity with migration by looking at decision-making, migration goals and use of remittances of couples with children of which one spouse is working abroad. In this way, the research will contribute to the migration-development debate. In order to do this, the following question will guide the research:
How do migrant workers and their spouses decide on the use of remittances, who and what influences these decisions, and are migrant workers and their spouses actually achieving their migration goals?
The following sub-questions will be used to answer this question:
What are the general characteristics and goals of migration of migrant workers and
their household members covered by the research in Bacolod City?
How are remittances used by couples and how are decisions regarding the use of
remittances made within these households?
Which goals of migration have been achieved so far and what explains the success
and failure of couples to achieve migration goals?
These sub-questions will each guide one chapter and chapter 4 will present case studies. The conclusion will answer the central question.1
1.2 Theoretical framework
A few concepts that are central to this research will be defined first to show what meaning is referred to when the concepts are mentioned.
There exist three categories of Filipinos who work overseas, or ‘Overseas Filipino’s’:
permanent, temporary and irregular migrants. This research focuses on officially documented temporary migrants, which are defined as follows:
‘Overseas Filipinos whose stay overseas ... is temporary owing to the employment-related nature of their status in the host country. Temporary migrants include
1I was inspired to do this research because there seems to be an ongoing ‘battle’ between quantitative and
qualitative researchers. My own qualitative research will be supported by existing quantitative research because I think both types of research could and should benefit from one another. Especially when studying such a complex relation as the link between migration and development, I think it is crucial to acknowledge the
land-based and sea-based contract workers, intra-company transferees, students, trainees, entrepreneurs, businessmen, traders and others whose stay abroad is six months or more, and their accompanying dependents’ (Castro, 2006: 8).
The household can be understood as ‘a group of people who share the same residence and participate collectively, if not always cooperatively, in the basic tasks of reproduction and
consumption’ (Brydon and Chant, 1993: 8-10 in: Chant and McIlwaine, 1995: 4). The members that are part of the household are of interest to this research, because ‘households do not decide things, people within households do’ (Wolf, 1994: 15 in: Eder, 2006: 401). The decision-making processes of interest to this research are decisions that are part of the household strategy, such as decisions concerning the use of remittances and plans for the future. A household strategy can be understood as ‘the varying economic activities of households, deliberately planned or not, as their members respond to the changing circumstances around them’ (Clay and Schwarzweller, 1991: 5-6 in: Eder, 2006: 401).
Due to the household-level focus on development of this research, I chose to use a definition of development of Sen (1999) which is focused on the local level as well. De Haas (2007: 28) argues there is a need to broaden our definition of ‘development’ when studying the link between migration and development and he uses Sen’s definition on development to do so. According to Sen,
‘development involves reducing deprivation or broadening choice’ (Sen, 1999 in: Nafziger, 2006: 3) Deprivation in this sense can be understood as ‘a multidimensional view of poverty that includes hunger, illiteracy, illness and poor health, powerlessness, voicelessness, insecurity, humiliation, and a lack of access to basic infrastructure’ (Narayan et al. 2000: 4-5, in: Nafziger, 2006: 3).
Because migrants ‘interact with the state by generating flows of knowledge, remittances and political ideas’, they are sometimes considered as ‘agents of development’(Faist, 2008:21).
International organizations, national governments and scholars therefore promoted migration as a tool to stimulate economic development (De Haas, 2007). Migration could reduce poverty, change consumption, increase human capital and remittances can have multiplier effects through increased local spending (Adams and Page, 2003 and Gupta et al, 2009). Because remittances often flow from rich to developing countries, inequalities between regions can be reduced by migration (Van Doorn, 2002 and Hanson, 2008). Remittances can also lead to economic growth because they help to make productive investments (Giuliano and Ruiz-Arranz, 2006 and Acosta et al 2007) and to financial development due to increased use of bank transfers (Aggarwal et al, 2006). Migration is also used to solve structural problems like unemployment in some countries, for example the Philippines
(Gorodzeisky and Semyonov, 2004). If remittances are used for investments such as housing, small businesses and additional land this can improve the living standard of migrant households (Grabel,
2008: 15 and Ratha, 2007).
From the 1970s onwards, pessimism on the migration-development relation started to prevail
(De Haas, 2007). Frequently discussed consequences of migration which adversely affect development are the ‘brain drain’ and ‘brawn drain’ (De Haas, 2007). These terms describe that educated and young, capable workers flow out of developing countries (Lewis, 1986 in: De Haas, 2007). Migrants are usually not the poorest residents of a country because they need some capital to migrate. Migration could therefore increase inequalities because it helps the people who already have a higher income to become wealthier (Lipton, 1980). Migration could also increase
dependencies, as recipients of remittances sometimes reduce their efforts to earn money because they rely on the remittances (Chami et al, 2005). Consumption preferences of migrants might change due to exposure of goods and lifestyles in destination countries (Lipton, 1980), which can increase demand for foreign goods (De Haas, 2007). This could increase inequalities further as developed countries benefit from cheap imported labor and increased demand for ‘western’ products from migrant households.
Remittances which are used for productive investments tend to reduce poverty, vulnerability and inequality between households on the long-term. Local consumption on the other hand might increase inequalities between households and are likely to have short-term significance only (Chimhowu et al, 2005). Perhaps this explains why pessimists often focused on the lack of
investments of migrant households to explain why migration could adversely affect development. Remittances increase the total household income which gives household members the opportunity to consume more. Many scholars conclude that a large share of remittances is indeed used for consumption (See, for example, Gupta et al, 2009 and Grabel, 2008). Some scholars even argue that most of the income earned abroad is spent on conspicuous consumption (De Haas, 2007: 44). This concept of Veblen explains that wealthy individuals are willing to pay a higher price for a product that has an equal function to a lower priced good, in order to achieve a higher status (Veblen, 1899 in: Bagwell and Bernheim, 1996: 349). Examples of conspicuous consumption of migrant households are luxurious houses, cars, gadgets, jewelry and celebrations.
In short, it is still unclear to what extent migration leads to development. Specific
circumstances in sending and receiving countries can show on a smaller scale if migration leads to development (De Haas, 2007). The aim of this research is to show exactly this for households that are included in this research. The work of James Eder is particularly relevant in this analysis. Eder has done a lot of research on household decision-making, social structures and livelihood strategies in the Philippines. In ‘Who shall succeed’ (1982), Eder focuses on farmers who migrated from Cuyo to San Jose, Palawan. Eder tries to explain the ability of some farmers and their household members to
interplay between individual motives and behavior, and economic and social environment’ (Eder, 1982: 81). Personal characteristics that lead to success, according to Eder, are hard work and cooperation between husband and wife. The social and economic environments of the households that lead to success are income diversification and innovative ways of making a living. The social network of the family also influences success. My research also uses individual characteristics and the economic and social environment to explain success and failure of couples to achieve migration goals.
Ali (2007) discusses a ‘culture of migration’ among Muslims in India. He argues remittances increase consumption in countries such as Bangladesh and the Philippines and they enhance a culture of migration. Positive stories of migration prevail and negative stories are given less weight, either by the migrants or by people who dream to migrate in the future. Ali uses the following definition for this ‘culture of migration’: ‘The cultural atmosphere that leads many to decide to migrate’ (Kandel and Massey, 2002 in: Ali, 2007: 38). In the Philippines, migrants are portrayed as national heroes by the state and citizens (Rodriguez, 2002) and people are familiarized with the idea that migration is a likely livelihood strategy from an early age (Aguilar, 2009). A culture of migration might also exist in the Philippines because some people see migration as a goal in itself and do not consider other possibilities. Migration is then regarded as an only and necessary option rather than a deliberate economic choice.
Migration from the Philippines is often a family strategy rather than an individual strategy (Stark, 1991 in: Haug, 2008: 587) which is why I decided to focus on households instead of individual migrants. In the Philippines, people often carry responsibilities for relatives, in specific their parents and siblings. The eldest child is expected to sacrifice for his or her relatives and has to provide in their needs (Aguilar, 2013). This cultural tradition influences migration because social networks and obligations both facilitate and constrain the success of migrants. In the first stage, migrants often receive help from their social network to find employment abroad. Later, migrants are expected to help relatives find employment and housing abroad or to provide financial support (Nagasaka, 1998). The obligations towards members of the social network can be a large financial burden to migrants and their household members. This cultural pressure might influence the ability of couples to achieve migration goals. Both the culture of migration and responsibilities to relatives are part of the social circumstances that influence the ability of couples to achieve their goals and thus, household development.
The theory of relative deprivation explains an individual can feel discontented not only because of a low income, but also because this income is lower than the income of people from his or her social network. When this theory is applied to migration, it suggests people do not migrate just to get access to a higher income, but also to improve their relative situation compared to the
situation of people in their reference group (Hyll and Schneider, 2013: 334). Migrants and their families might thus compare their situation to that of others in terms of status and assets. As a result, couples might want to own specific goods not to improve their absolute wealth, but their relative
wealth compared to the wealth of others.
1.3 Migration and the household in the Philippines
Women in the Philippines often control the budget of the household (Parreñas, 2005b: 325 and Chant and McIlwaine, 1995: 7). It is commonly expected that women provide emotional care whereas men should take care of the material needs of the family in the Philippines (Parreñas, 2005a: 252). Because many women migrate from the Philippines, this household division of labor might change. However, many non-OFW women also have wage employment or generate an income in another way to provide in the material needs of the family. Within the household men and women seem to be relatively equal and married women enjoy a high level of autonomy. ‘This influential position of married Philippine women seems related to their control of household finances, their right to equal inheritance and ownership of property’ (Rutten, 1982: 46). Because of this relatively strong position of women within the household and high rates of labor force participation, Philippine women have a strong influence on decision-making within the household (Chant and McIlwaine, 1995: 6). However, the low-status and low-paid employment that women often have in and outside the Philippines, for example as entertainment workers, domestic helpers and caretakers, show men and women are not equal in all aspects. On average, men earn a higher income than women do which explains in part why Semyonov (2005) argues that men remit more money to their household in the Philippines than women do. This is in contrast to findings of earlier studies, which could be due to the difference in samples. The young women of other studies appear to remit more money than the married women of Semyonov’s sample do. This might be because unmarried women usually have more obligations towards their parents than married women have because married women are expected to take care of their own household (Aguilar, 2009). Semyonov argues, on average, men remit 60 percent and women 45 percent of their total earnings, which comprises 78 and 66 percent of the total household income respectively (Semyonov, 2005: 54).
When couples marry, it is often expected that the couple becomes independent soon by moving in to their own house. This can explain why most migrant households strive to own a house in the first decade after migration. Households increasingly show a preference for costly,
‘westernized models’ in housing due to their increased wealth (Aguilar, 2009: 377). Aguilar sums up what migration is all about for migrant households in the Philippines:
‘When the needs of children are well provided for, when they are able to complete schooling (in private institutions, which most prefer), and when children turn out to be responsible adults who eventually take their turn in producing and nurturing the next generation; when the marriage is intact; and when family and
community-level expectations and obligations are met, then the venture to work abroad is seen as well worth it’ (Aguilar, 2009: 372).
1.4 Context
Because the social, economic and political circumstances determine to what extent the development potential of migration can be exploited (De Haas, 2005: 1275), the political and economic context of the Philippines will now be discussed in addition to social circumstances that were discussed earlier.
Migration from the Philippines already started in the early twentieth century (Constable,
2007).The government introduced labor export policy from the 1970s onwards which encouraged migration to reduce unemployment (Agunias, 2008). The government started to focus primarily on the protection of migrant workers in a later stage (Mackenzie, 2005), but there are still government-initiated benefits for officially documented migrants. Examples of such benefits are pre-migration trainings, life and medical insurance, pension plans, pre-departure and emergency loans. It is compulsory to register for these benefits at a cost of less than $200 a year through the Overseas Workers Welfare Administration. Tax-free investment programs are also offered to stimulate migrant workers to make productive investments (Mishra and Rajan, 2007).
The economic situation in the Philippines is a reason to seek employment abroad for many
Filipinos. High unemployment rates, especially among educated workers and women, the low wages offered to workers in the Philippines, political instability, poor overall economic circumstances and slow development are reasons for Filipinos to work abroad (Gorodzeisky and Semyonov, 2004). Remittances are likely to be more effective in countries with a good investment and policy environment with well-developed institutions and financial systems (Ratha, 2007:5). Such circumstances thus influence the ability of households to contribute to development.
In 2012, 48.3% of the OFWs were female and 51.7% male (Philippine Commission on Women,
2014). The majority of OFWs in 2011 were unskilled workers and laborers (32.7 %). Many OFWs work in the service and construction industry (15.5 and 13.6%) or as professionals (10.6 %) (Capones, 2013). Female OFWs are often employed as domestic helpers, caregivers or entertainment workers, which is often ‘a euphemism for prostitutes’ (Chant and McIlwaine, 1995: 34).Male OFWS often work as construction workers, machine operators or service workers and both men and women are employed in the hotel and restaurant sector (Gorodzeisky and Semyonov, 2004). In 2012, almost 53%
of all OFWs worked in the Middle East, which makes this region the top-region for OFWs (Domingo, 2009). Domestic workers form the largest occupational group of OFWs in the Middle East. This region is well known for the stories about abused immigrants and is therefore considered as a ‘difficult work environment’ (Watanabe, 2014: 25). East and Southeast/Central Asia are other important destination regions, with almost 17% and 11% of all OFWs working in these regions respectively in 2012. Also in 2012, 8.6% of the OFWs worked in Europe and 7.6% in North and South America (NSO, 2011). Almost one out of every three international seafarers is from the Philippines which makes Filipino seafarers the largest national group of seafarers (McKay, 2007). Many seafarers come from Mindanao or the Visayas and many areas in the Visayas are considered as ‘traditional seafaring communities’
(Fernandez and Krootjes, 2007: 59). There are over 50 maritime colleges in the Philippines of which many can be found in the Visayas. Many Filipinos are employed by Norwegian shipping companies (Lamvik, 2001) but also on international vessels from other countries. Filipino seafarers are mostly recruited for low ranks and only a minority reaches officer ranks (McKay, 2007: 662).
1.5 Setting
The research was conducted in Bacolod City, Negros occidental, which is part of the Western Visayas in the Philippines. This region is a large OFW sending region as 8.5% of OFWs originate from this region. Bacolod City counted 511.820 inhabitants in 2010, of which 63% is considered to be
economically active. The city is classified as highly urbanized (Philippine Statistics Authority, 2012a). In total, 24 percent of the population of Bacolod City has attended or finished higher education (college undergraduate, academic degree or post baccalaureate) and over 38.000 people hold an academic degree (NSO, 2002). Over thirty percent of the population has attended or finished high school. There are around twelve schools in Bacolod City (elementary, high school and college, mostly private schools) and several shopping malls, restaurants, government offices, hotels and a few spa’s and call centers. Several private subdivisions can be found in Bacolod City where people from middle and high income classes live and there are a few squatters-areas.
Before Negros Occidental became a large sending area of migrants, it used to be a region of
in-migration. Between 1845 and 1918, hundreds of new plantations were created out of underutilized jungle. Migrants from a nearby island group, Panay, were attracted to these regions by increases in demand for tenants and plantation workers. These migrants saw possibilities to improve their material conditions compared to conditions in Panay (Larkin, 1993: 60). A large part of the land area of Negros Occidental is still used for sugarcane production today and many people in Negros
Occidental cultivate sugar cane (Rutten, 1982). Plantations used to be owned by planter families who lived in the city, also in Bacolod City. Wage dependent worker families usually worked and lived on
these plantations. Since the government initiated a land reform program, the ownership relations have changed. Agriculture and fishery are important sources of livelihood in Negros Occidental (Public Information Division, 2010).
1.6 Methodology
The fieldwork took place from January 7thto March 27th. I stayed with an OFW household most of the
time, which gave me the opportunity to observe household decision-making and to have interviews with both spouses. I conducted informal and structured interviews with spouses of OFWs, OFWs on leave, returned OFWs, relatives of OFWs, experts and other Filipinos that shared their knowledge and opinions. Most informants were the spouse of an OFW who had a child or children. Nineteen households were observed and/or interviewed frequently and these households will be analyzed in-depth throughout this research. Data gathered during interviews with other informants, such as (returned) OFWs and relatives of OFWs will also be discussed. My gatekeepers were my host-mother, a teacher in a private school and a woman who worked for a local NGO; all helped me get access to informants. Names mentioned throughout this thesis are all pseudonyms to ensure confidentiality of my informants.
Structured interviews were used to gather data on pre-listed topics such as goals of migration,
reasons to go abroad, use of remittances, decisions regarding the total household income and other topics. The informal interviews increased my insight in household dynamics such as decision-making regarding the use of remittances and plans for the future. At the start of every structured interview with a new informant, I used a household survey to gather quick information on all household members. Finally, observation helped me to learn more about household dynamics, decision-making processes, relations within the household, purchases that were made in the past and the standard of living of households. I observed my host family, different households during meal time and family gatherings or mass and in several places in Bacolod City such as restaurants, schools and malls. Most interviews were conducted at the house of my informants. Because I am a woman, I decided not to interview men in their homes by myself which made it more difficult to find male informants. Many informants expressed they assumed I am rich because I am white and they might have been reluctant to share stories about financial hardships. The fact that I am unmarried and without children and religion might also have influenced the information that informants shared with me.
I do not claim that the households included in my research are representative for OFW households in general, because most of my informants did not face extreme hardships and were doing quite well in economic terms. When I interviewed informants who did not speak English, I was
always accompanied by an interpreter. Although my interpreter tried to translate as direct as possible, it is likely some informatio
Figure 1.1 Map of the Philippines
always accompanied by an interpreter. Although my interpreter tried to translate as direct as possible, it is likely some information got lost (or added) in this translation.
Figure 1.1 Map of the Philippines
Source: www.worldpress.org
Chapter 2 General characteristics of the migrant household members and goals of migration 2.1 Introduction
This chapter will discuss characteristics of migrant households that were included in the research. Descriptions of characteristics such as income, household size, education, occupations and destinations of OFWs will create understanding on the budget of household members and their knowledge on how to budget money. This will help to understand how couples decide on the use of the total household income in the next chapter, and if or how couples achieve their migration goals. As was mentioned in the introduction, the social, political and economic circumstances in the sending and host country determine to what extent migration can lead to development. This chapter will therefore create a picture on the social and economic situation of the households.
The data of this chapter was gathered with a household survey and interviews. Nineteen couples with children of which one of the spouses is working abroad will be presented. Informants who do not fit the former description will be discussed separately. The aim of this chapter is to answer the following sub-question:
What are the general characteristics and goals of migration of migrant workers and their household members covered by the research in Bacolod City?
Income class is an important characteristic for this research because it influences decision-making, migration goals and achievement of these goals, among other things. The goals of migration show what couples see as desirable development for their family. The goals of migration are discussed in detail in order to be able to link these goals to explanations for success or failure to achieve goals in later chapters.
2.2 General characteristics
The total household income influences the use of remittances, migration goals and it determines how much household members can consume, save and invest. I did not ask all informants about their total income, but I estimated their income class by observing housing, education levels, purchases and the ability to afford non-necessities such as a car, a maid and holidays. Based on these
observations, I made three categories of income class to show differences in total household income and the ability of couples from different income classes to finance daily needs, luxuries and goals of migration.
1. Low income class: household members struggle to pay for daily needs such as food, housing, clothing, health care, and education.
2. Middle income class: household members can afford some luxuries, like a car or private education for their children, but not all luxuries like people in the high income class can afford.
3. High income class: household members are able to afford a car, a house and lot, a maid and private education for the children.
These income classes help to observe decisions of couples in each income class to consume, invest and save and if they achieve their goals of migration. It is important to take income class into account because ‘poor families will need more time than better off families to gain from migration’
(Gamburd, 2000, in: Engberg-Pedersen et al, 2002: 15).
Directly related to income class is the occupation of the OFWs and their spouses, which suggests what the total household income might be more or less. The destination of the OFW also influences income. Some destination countries mostly offer migrant workers low-wage jobs. Not all OFWs fit these ‘expectations’ which makes looking at each household closely beneficial.
The education of household members could tell something about their knowledge on how to budget money, about the employment they have and it shows the ability of couples to finance private education of the children.
Finally, the number of children is an important characteristic. A certain income might be sufficient to finance daily needs, private education and a house and lot for a household with only one child. However, couples with four children might struggle to meet daily needs or to achieve migration goals with a similar income.
Table 2.1 General characteristics of OFW households in Bacolod
2.3 Occupations of the OFWs and their spouses
As can be observed in table 2.1 and table 2.2, many OFWs of the included households were
seafarers. The rank of the seafarer on board often determines the salary. Marine college graduates usually start as an apprentice before they become an oiler and later a wiper. After this, they can attain higher ranks such as the 3rdengineer or a motorman. The income disparities between an oiler
and the 3rdengineer, for example, can be quite large. In the past, contracts for longer periods of time
were given to seafarers but now seafarers are usually allowed to work abroad for 9 to 10 months only. When the contract finishes they have to wait for 2 to 3 months in the Philippines, usually unpaid, before they can apply for another contract. Most seafarers have the opportunity to work overtime on board. When seafarers finish a contract they can bring these overtime hours home in cash. A Dutch captain who worked for a Dutch vessel explained he mostly works with male Filipinos on board.
I only interviewed women who were married to a seafarer and no men who were married to a seafarer. All informants that were married to a domestic helper were male. The OFWs that worked as a nurse, domestic helper or in a hotel or restaurant were all from the low or middle income class. The income classes of households with a seafarer are mixed and depend on the rank of the seafarer. Informants from the high income class were married to a high-rank seafarer, engineer or supervisor. One of the OFWs working as a supervisor used to work as an electrician and worked his way up to be a supervisor within the same company. The OFWs that worked in a hotel or restaurant were only planning to do this for a few years until they would find a higher-paid job that would fit their education better. For the domestic helpers, this was mixed. Two women were already working as domestic helpers for many years, whereas the other two just started with the intention to work abroad only for a few years. Being a seafarer or engineer seems to be a long-term occupation.
Table 2.2 Occupations of the OFWs
Occupation Quantity Destinations Gender
Seafarer 8 - All men
Domestic helper 4 Hong Kong, Singapore, Kuwait (2)
All women
Working in a hotel or
restaurant 3 Kuwait, Qatar, Dubai 2 men, 1 woman
Supervisor 2 Qatar, Papua New
Guinea 1 man, 1 woman
Nurse 1 Saudi Arabia Man
Four of the OFW spouses were teachers because I had a gatekeeper in a private school in Bacolod City (high school and college). She was in charge of the financial department of the school. Using the snowball method, I found more informants within this school. Two of these teachers had a higher position within the school, one as a supervisor and one as the director of basic education.
Some of my female high income class informants told me they used their income, if they were employed themselves, only for their own needs. They used their salary for shopping, going out for meals with friends and to have some savings. Some informants found employment because they felt it would be a waste of their own education not to work or to distract themselves from the absence of their spouse.
‘His income would be sufficient already but I believe the wife has to help her
husband in the same way as the husband should help the wife. Besides, I am a college graduate. What would be the use of my education if I would just stay at home? ’ (Isabel Cruz, February 2014).
Only women mentioned they wanted their own income because they did not want to ask their husband for extra money if they want to do or buy something. Other informants mentioned extra income was crucial because the remittances were not enough to make ends meet. Three informants used their own income for expenses of which the spouse was not aware, such as savings, helping relatives or personal consumption.
Table 2.3 Occupations of spouses
Occupation Quantity Gender
Teacher 4 All women
In control of small business 4 2 men, 2 women
Restaurant employee 3 2 men, 1 woman
Call center agent 1 woman
Manager 1 woman
Employee at money transfer
company 1 woman
Pollution officer 1 man
None 4 1 man, 3 women
More spouses of OFWs from the low income class did not have employment or spent little time working whereas more informants from the middle or high income class had full-time occupations. I expected low income class informants to find employment to improve their standard of living but I did not find an explanation for why this was not the case.
Some households had additional sources of income besides wage employment. One family just started a small piggery of two pigs and they were planning to buy more pigs in the future. One
woman sells frozen food in addition to being a waitress. One man owns a small canteen besides his employment in a restaurant. One woman runs a business in grilled food. Because her seafaring husband does not receive any salary during his return visits, he works on small projects in the repair shop of his sister when he is on leave. One teacher owns a second house with her husband which they rent out. They are planning to invest more money in a new house. One other household was renting out a house but this is a short-term source of income because their son will be moving into that house when he is going to college next year.
2.4 Destinations of OFWs
Informants mentioned that the salary in countries such as Kuwait and Qatar is often low and sometimes the circumstances of working there are far from ideal. The spouses of OFWs who are working in the Middle East as a domestic helper, nurse or waiter did not mention abuse or violation of contracts but the salary of their wife or husband was low and they struggled to make ends meet. Those informants also stressed they were not rich like many people expect OFW families to be. These stories are in line with the general perception of the Middle-East as a region offering low-skilled jobs (Watanabe, 2014).
Figure 2.4a Recruitment agency in Bacolod City Figure 2.4b Recruitment agency in Bacolod City
The engineer who worked in Jakarta used to work in many countries before. He works on contracts for the company and has to go wherever there are projects. The same goes for one woman working in Qatar. The OFW working as a supervisor in Papua New Guinea used to work in other countries
before and now works for an electrical company as a supervisor. His company offers him contracts as well and therefore, the destination is not really a choice. The domestic helpers, nurse and hotel or restaurant employees used an agency or website to find employment. Their decision to go to the specific destination country was influenced by the availability of contracts and costs of going to these countries. Usually, OFWs did not have a desire to move to a specific country but demand,
connections, job offers, agencies or a combination determined the destination. Some people wanted to avoid working in the Middle East or had a desire to work in Europe or the United states. However, the costs and difficulties to go there are reasons to find other destinations.
2.5 Housing of informants
The informants from the high income class whom I visited at home all lived in private subdivisions. This means there is a gate around the houses and subdivisions. At the entrance of such a private subdivision is usually a guard house. The guards will either check if you have an ‘ID sticker’ or they will ask for your ID to prevent unwanted guests from entering the subdivision. The residents of these subdivisions often have a helper who will open the gate whenever the owners of the house honk the horn of the car. Usually, high income class informants own a car, one or multiple televisions and computers, a kitchen with plenty of appliances and a separate living area for their helper. The informants from the high income class all lived in well decorated houses with plenty of furniture and bedrooms for all household members. Usually, there were multiple bathrooms and a spare bedroom. Living conditions of informants from the middle class are diverse. Most people also live in a (small) subdivision in houses with some furniture, a television and kitchen appliances. Usually, they do not have extra bath – or bedrooms, a car port or parking space which the informants from the high income class do have.
Informants from the lower income class either lived in one of the squatters-areas near the city centre of Bacolod City or in a small subdivision where housing was basic (no cars, one bedroom and a small bathroom, if any). Within this class, living conditions are also very diverse. Some people do have tiled floors whereas other people live on a floor that is not tiled and cold or muddy when it is raining. Only one of the informants in the lower income class owned a car but she had many debts. Most informants in the low income class owned a single-storey house. Only one house was
surrounded by a gate and all other houses did not have a gate and had a simple door without obvious locks or protection from outsiders. Usually, there was some furniture, a television, kitchen appliances and a single bath- and bedroom.
Many subdivisions have a specific reputation. Some are known to be only for the ‘very rich’, whereas other subdivisions are known to be mostly for lower income classes. The difference
between middle and upper class subdivisions is usually the level of protection against outsiders and the quality and size of houses within the subdivision. Expensive subdivisions usually have additional facilities such as a swimming pool or clubhouse with a gym or basketball court.
Figure 2.5a House of low income class informant Figure 2.5b House of high income class informant
2.6 Reasons to go abroad and goals of migration
The goals of migration of the household members are of paramount importance to this research because they show what couples consider as desirable development for their families. Knowledge on what couples would like to achieve with migration will allow me to analyze to what extent couples are successful in doing so in later chapters.
For most couples, the main reason to go abroad was different from the goals of migration. The (assumed) higher pay in the host country and the low wages in the Philippines were often the main reasons to go abroad. Some OFWs went abroad because they were unemployed in the Philippines. Another reason to go abroad is the fact that there are few opportunities in the Philippines for educated workers. For some OFWs, migration has been the livelihood strategy since graduation and therefore they did not try their luck on the domestic labor market because they chose a certain course, for example marine engineering, that limits domestic job opportunities. The reasons to go abroad that informants have mentioned are in line with the conclusions of many scholars. Scholars often stress that labor migration from the Philippines can be understood as a result of poor economic conditions and high unemployment rates coupled with slow economic and industrial development
and high fertility rates (Go, 1998 in: Gorodzeisky and Semyonov, 2004: 9). One of my informants summed up the opinions that were expressed during many other interviews: ‘the only way to live a
comfortable and secure life is to have someone work abroad so that the children will have a secure life’ (Anne, February 2014). In short, the reasons to leave seem to be connected to the situation in
the Philippines on the one hand and the opportunities and higher wages abroad on the other. Seen from this angle, the reasons to go abroad mentioned by my informants seem to fit Lee’s laws, better known as the push and pull model, quite well (Lee, 1966). These laws explain that factors which are included in the decision to migrate are factors associated with the home country, the destination country, personal factors and intervening obstacles.
The goals of migration are often related to the migration history of the household. Usually, the first goal couples have is the education of their children or to own a house. If the OFW is working abroad for some years already, the education of the children is sometimes already paid for or the household has savings to pay for this. In short, household members seem to add goals when migration forms a livelihood strategy for the medium to long-term. The goals of migration are thus connected to the years of employment abroad and the goals that have been achieved already. As can be observed in table 2.4, except for one spouse, most high-income OFWs have been working abroad for more than ten years already. Two of the three lower-income class households of an OFW who worked abroad for more than 10 years need some clarification. Angel’s husband used to be a seafarer but is now unemployed for a number of years already. As a result, the couple has several debts. Paul’s wife works as a domestic helper. They support their grandchildren because one of their children passed away. The specific situation of these two households seems to explain why the couples still struggled to meet daily needs despite the number of years during which a household member has worked abroad. For the household of Lilly, I did not find such a specific explanation besides the fact that the couple did not seem to have a clear idea on budgeting and lacked specific plans for the future.
Table 2.4 Migration history of the households Informant Years
abroad of current OFW
Primary goal(s) Any other household
members that used to work/ are working/ planning to work abroad?
Income class
Edwin First year Education children Maybe after three years informant will go abroad 1 Billy 1 Education children, desire to go
abroad No 1
Joy 2 Education child, daily needs Informant plans to work abroad in the future 1 Gem 2 Poverty reduction, daily needs and
education children Maybe informant will work abroad if his wife returns 1 Bobby 8 Education children, bigger house Son will work abroad now 1 Paul 16 Education grandchildren, daily
needs, desire to work abroad Daughter since 5 years 1 Lilly 22 Education children, daily needs,
investment Yes, one son since 3 years 1 Angel 25 Education children, daily needs,
loan repayment No 1
Linda 3 House and lot Informant worked in Dubai in the past 2
Beth 4 Education children No 2
Sally 10 Education children, daily needs No 2 Rose 17 Education children, husband had
education for it, house and lot, car, investment
No 2
Roberto 4 Education children, maintain
lifestyle No 3
Celia 12 House and lot, taking care of
relatives No 3
Anne 16 Education children, provide in
needs of the household No 3
Rosa 20 Education children, house and lot,
car and investment for retirement Sons both want to work abroad 3 Joan 21 Education children, house and lot,
investment for retirement age No 3 Isabel 27 Husband had education for it,
saving and investment, house and lot
Informant thinks about working abroad in the future but her husband disagrees
3
Grace 39 Education children, house and lot One son is in the process of finding employment abroad
3
The goals of migration that were mentioned by one or multiple informants will now be discussed separately.
Education of the children
The most important goal for many couples is the education of the children. Informants often mentioned that public education is of low quality in the Philippines. Sometimes students have the possibility to become a so called ‘working student’ in college. This means students work at their university and in return they do not have to pay tuition fees. However, tuition fees often form a large financial burden for households, especially when the household size is large. Tuition fees differ between schools and cities. In Manila, a course in hotel and restaurant management costs 55.000 pesos (college of St. Benilde), this same course costs 50.000 pesos per semester in Bacolod City (La Consolacion College)2. There are some schools in Bacolod City which have a good reputation, such as
Colegio San Augustin (pre-school, elementary, secondary and college) and University of Saint La Salle (grade school, high school and college). Some informants suggested that private education would help their children find a job on the international labor market. Most informants wanted to finance private high school and college to make sure their children would have a secure future ahead. Some children went to a University in a bigger city such as Manila or Dumaguete. Most informants only considered public education as a last option if there is no money to finance private education. The desire to finance private education could also be a matter of status. Most informants want their children to go to private schools but they are well aware of the few chances for educated workers in the Philippines. Therefore, the choice to invest so much money in private education might be because people would feel discontented if other people around them are sending their children to private schools. In short, the feeling of being relatively worse of, or relatively deprived, might be the very reason for people to send their children to private schools.
Housing
Couples often wanted to make improvements on the house, move to a bigger house or buy a house and lot. Housing was part of the migration goals of most couples in some way. Some couples still lived with their relatives and in-laws and wanted to have a place of their own. For other couples owning a house was regarded as a way to have a secure future. Only one couple lived in a rented house. All of the other couples either lived in a squatters-area, with relatives or in their own house. Renting was not considered as an option by most informants because of the high costs and the lack of security to have a place to live in the future. Some informants mentioned they do not want to rely on their children when they retire and therefore they wanted to own a house.
2As of May 26th, 2014 the exchange rate was 43.69 pesos = 1 US Dollar. In comparison to the high tuition fees,
the daily minimum wage rate in non-agricultural sectors is 466 pesos in 2014 (Department of Labor and Employment, 2013).
Improvements in the standard of living
Couples usually have multiple goals. Sometimes the goal of employment abroad is to improve the standard of living in general. Some informants wanted to live ‘a comfortable life’ or wanted to be able to afford the things they see ‘others’ can afford to buy. Having a secure source of income was also mentioned as an improvement in the standard of living in general.
Poverty reduction
In the squatters-area, some informants mentioned the primary goal of migration was poverty reduction. The extra income would allow couples to pay for food and clothing more easily. Other informants (not included in the tables) mentioned that the household member also went abroad to reduce poverty. In the squatters-area there are quite a lot of OFW families and there it is more common that an unmarried son or daughter is working abroad rather than a husband or wife with children. An explanation for this was not found during the fieldwork.
Migration as a goal in itself
Some informants mentioned that his or her spouse had a desire to experience working and living abroad, usually in combination with other goals. Because of the long history in migration and the large numbers of OFWs leaving the Philippines, migration is considered as an only or necessary option by many couples. Because of the culture of migration (Ali, 2007) that seems to be present in the Philippines, migration is regarded as the one and only way to be successful by many Filipino’s. The expectations of migration are high whereas the expectations of chances in the Philippines are low. In this way, migration becomes a goal in itself and some couples therefore lack specific goals of migration. Many informants did not have confidence in the government of the Philippines, which is why they saw migration as an only option to have security of income and health care for their household. They focused on a secure source of income and strong family ties because they ‘would never expect something from the state. All they [the state] do is steal money from the poor’ (Rosa, February 2014). Some other people who did not migrate were less positive about the benefits of migration.‘ In terms of economy, yes, they [migrants] help a lot. But since our government is full of corruption, it's still useless’ (young woman who deliberately chose to work as a local seafarer, March 2014).
Support relatives
Some migrants went abroad to support relatives in the Philippines besides their spouse and children which would be difficult with a local salary. Part of this money was sent for a specific cause, such as to repair the house, pay for medical bills, the education of younger siblings or daily needs. Other migrants just sent money and let their relatives decide on the use themselves.
Maintain a specific lifestyle
Sometimes the OFW had to remain working abroad because the household was now used to a specific lifestyle. Couples would be unable to finance some luxuries such as a helper, going out for dinner, consumption habits or a car if the OFW would return permanently.
Saving and investment
Mostly informants that were married to an OFW who had been working abroad for many years mentioned that having savings or investments was one of their goals now. They wanted to save money for future use. Some said this would be for their retirement age, others for emergencies and some couples saved money to be able to enjoy early retirement or start a business once the OFW returns.
2.7 Conclusion
The most important characteristic of the household members for this research appears to be income class, because it is related to the occupations of the spouses and OFWs, household decision-making, the destinations of the OFWs and the education of the household members. Income class also appeared to have a relation with the migration history of the household because most of the OFWs in the high income class households have been abroad for more than 10 years. The migration history also influences migration goals because some goals gain priority in a later stage when other goals have been achieved already. For most informants there is a difference between reasons to go abroad and goals of migration. The low salary, few opportunities for educated workers, the high
unemployment rates in the Philippines and the high salaries offered abroad were important reasons to go abroad. The education of the children and a house and lot are included in the migration goals of most couples. Couples also wanted to support relatives and save or invest money.
The goals of migration reflect what couples consider as desirable development for their household. This kind of development is not necessarily related to what is considered as desirable development by scholars and international organizations or governments on the macro-level. Signaling what couples see as development is the first step in reducing the gap of knowledge on what is considered as development by migrant households. This kind of knowledge will contribute to the debate on the link between migration and development.
Chapter 3 Use of remittances 3.1 Introduction
Since the 1970s, the dominant perception has been that remittances are mostly used for
consumption and rarely for productive investments in developing regions such as Asia, Africa and Latin America (De Haas, 2005: 1274, Kapur, 2003: 17 and Lamvik, 2001: 11). Lipton argues that 90 percent of the remittances are being spent on everyday consumption (Lipton, 1980 in: De Haas, 2007: 29). According to De Haas (2005) however, there is increasing evidence from Latin American, Asian and African countries that households of which a member is working abroad are more likely to invest than non-migrant households are. In addition to this, he argues migration can also lead to increased wealth and economic activity. Evidence from the Philippines shows that households with a household member working abroad are doing substantially better compared to household without a member working abroad (Kapur, 2003: 16).
In short, there seem to be divergent opinions about the use of remittances by migrant households and the effects of this on development. This chapter will contribute to the debate through a discussion on how the households included in the research use remittances. The question that is central in this chapter is the following:
How are remittances used by couples and how are decisions regarding the use of remittances made within these households?
The way couples use remittances shows what they see as desirable development of their household. This chapter will discuss existing literature and data obtained during the fieldwork on the use of remittances by migrant households. Contrary to the emphasis of ‘pessimist’ scholars on the use of remittances on non-productive investments and conspicuous consumption, data of this research shows that most of the couples use a large part of the remittances for investments and their standard of living has improved. However, some spouses disagreed or were unable to budget and save money and did not make productive investments.
3.2. Remittance recipients
Most of the interviews were conducted with the spouse of an OFW. All of the spouses I have interviewed were receiving remittances except for one. This woman did not receive remittances currently because her husband, a seafarer, is unemployed. Some parents of OFWs in the squatters-area received remittances from their child(ren). These recipients were usually the mothers or sisters
of the OFW. Only one returned OFW told me he used to sent remittances to his father because he owns an ATM card. This OFW was a single man who went abroad to support his parents. If the money was sent to a female relative of the OFW in the squatters-area, the reason according to the recipient was that the OFW said she would be able to budget the money properly. The situation here is a bit different because some of these OFWs only send a small amount to their parents if they also have their own household to support.
In most cases, the spouse was the person to which the OFW sent most remittances. Some couples also supported other relatives with a smaller amount every month but in two cases the spouse of the OFW was responsible for transferring this amount. Some OFWs or their spouse also help relatives with the money earned abroad occasionally. This will be discussed in section 3.7. Within the households of which the spouse was the recipient of remittances this was usually the most logical or only option. Most OFWs went abroad to improve the life of their household members which is why they send money to their spouse to achieve this goal.
All OFWs sent money to their spouse monthly. The amount of sent remittances varies widely. One spouse received all of the salary of her spouse. This was the case with one OFW who was an engineer in Papua New Guinea; his expenses were paid for by the company he worked for. Other spouses receive half or part of the salary. The received amounts mentioned by informants varied from 5.000 pesos a month up to 80.000 pesos (roughly between 110 and 1.800 US Dollars)3and
these amounts were usually not the entire salary of the OFW. Two informants said the remittances were about half of the total household income, two said it was less than half of the total household income and the other 15 informants mentioned it was more than half of the total household income. The total household income is the salary of the husband and wife plus other sources of income of the household. The income earned abroad is the only source of income for four households. Remittances were the only or main source of income for most low income class households.
3.3 Use of the total household income
First, this section will provide a short overview of literature that discusses the use of remittances. After this, section 3.3.2 will show how the couples included in the research use their total household income.
3In 2013, the poverty threshold for a family of five was set by the Philippine government at 8.022 pesos a
3.3.1 ‘Productive’ and ‘non-productive’ use of remittances
When scholars discuss the relation between migration and development in developing countries, they often look at whether the remittances are used for productive investments or not. Brauw and Rozelle make a distinction between ‘consumptive investments’, which are consumptive assets that improve the standard of living, and ‘productive investments’, which are assets that improve the productive capacity of the household (Brauw and Rozelle, 2003: 1). Productive investments could be made in sales, agriculture, manufacturing and services, for example (Durand et al, 1996: 249). Productive investments could help the household members generate an income in the future. Some scholars acknowledge that improvements in housing or new housing can enhance physical well-being, hygiene and can increase labor productivity (Zarate-Hoyos, 2008: 564). Sen argues that money spent on food, education, health, medicines and housing can improve physical well-being and capabilities greatly (Sen, 1999 in: De Haas, 2007: 59). Althoug labels on investments could make analysis easier, they do not always describe the situation completely. For example, ‘consumptive investments’ made in housing and health care could increase the productive capacity of the household and therefore the line between consumptive and productive investments is a bit thin. Because productive investments could lead to more income and food, these investments are often regarded as leading to development whereas consumptive investments are often viewed as less promising. In this research, I will consider investmenst made in housing, food, medicine and (future) businesses as productive investments that stimulate household development. Other expenses on cars, gadgets, leisure activities, clothing and status will be considered as ‘consumptive investments’ or simply ‘consumption’, depending on wheter or not it improves the standard of living. Education is not labeled as a productive investment because private education does not necessarily lead to development in the Philippines, as it is unsure if the children will find employment that fits their education.
De Haas (2007) argues many scholars conclude that migrant families in developing countries spend most of their money on ‘conspicuous consumption’ such as imported consumer goods and non-productive enterprises, for example housing. Most scholars that conclude the development effect of migration is disappointing indeed focus on the lack of investments and use of remittances for consumption. A possible explanation some scholars provide for the lack of productive use of remittances is that remittances are first used to supplement income and later for investment (Zarate-Hoyos, 2008). This suggests that the incidence of investments is linked to the duration of
employment abroad. In my research, it was indeed the case that the households of which the OFW had been working abroad for a long time also seemed to be the households with more investments
many couples did make productive investments and consumptive investments that potentially increased the productivity and well-being of the household members.
Zarate-Hoyos (2008) argues that findings on lack of investments of field research may be due to particular characteristics of the studied households or regions rather than to characteristics of migrant households in general. Zarate-Hoyos finds higher saving and productive investment rates of migrant households in some communities in Mexico but not in other communities. Because of the differences between countries, communities and even individuals there should not be a general conclusion on the link between remittances and investment and a micro-level focus could increasae our understanding about the use of remittances. Most of the studies on migration, remittances and development focus on developing countries or regions such as Mexico, the Philippines and rural China. Although some scholars acknowledge that migrant families are normally not the poorest citizens of a country, they often do stress that the income of migrant families is still quite low (See for example Zarate-Hoyos, 2008: 563). Some high class informants seemed to have a total household income which was high enough to live a comfortable life but some families indeed had a total household income which was too low to finance daily needs and health care.
3.3.2 The use of the total household income in Bacolod City
The investments made by the couples included in the research indicate that the effect of migration on development is promising, at least for most couples included in the research, and thus not as negative as some scholars suggest. In the low income class, household members mostly used income for daily needs, poverty reduction and furniture. They also made productive investments and consumptive investments that increase well-being, such as house improvements, they started small businesses and added sanitary facilities to their home. Expenses on the education of the children was also important for some low income class couples.
Middle income class couples used their income and remittances mostly for the education of the children and loan repayment. Two couples from this class used money for a house and lot and one couple for a car. Couples in the middle income class also used money for savings and two couples started a small business.
The use of household income in higher income class households is quite similar but the high income class couples were more often using a bigger amount of money for savings and investment and less for loan repayment. All of the couples but one from the high income class used their income for a house and lot. Two couples from the high income class and one from the low income class used part of their total household income for health insurance. For many couples from the middle and high income class a house and the education of the children has priority and therefore couples did
