We estimate the causal impact of remittances on child labor and school participation in Colombia using data from its main metropolitan areas. We develop an instrumental variable strategy that leverages the unemployment shocks induced by the 2008 financial crisis in Colombian migrants’ main destination countries. We find that remittances reduce child labor but not schooling. Relative to their mean participation shares, these impacts are larger for younger children and girls. However, the reduction in child labor among girls is associated with a large increase in participation in household work. Finally, we also find that even though remittances reduce the labor supply of female adults, their percent-change impact on adults is smaller than that on children.
