Dean Yang's NBER Working Paper explores how international migration and remittances affect household investment in the Philippines. Using data from the 1997 Asian financial crisis, the paper analyzes how exchange rate shocks experienced by overseas Filipino workers impact their home households. The study finds that an appreciation of a migrant's currency against the Philippine peso leads to increases in household remittances, with an estimated elasticity of 0.60. These positive income shocks result in increased human capital accumulation and entrepreneurship in origin households. Child schooling and educational expenditure rise, while child labor falls. In the area of entrepreneurship, households increase hours worked in self-employment and are more likely to start capital-intensive household enterprises. The paper also addresses concerns about the causal relationship between exchange rate shocks and household investment, finding that the results are robust to various econometric tests. The study highlights the importance of remittances in developing countries and provides insights into how households respond to unexpected economic shocks. The findings contribute to understanding how households in developing countries respond to transitory changes in economic conditions.Dean Yang's NBER Working Paper explores how international migration and remittances affect household investment in the Philippines. Using data from the 1997 Asian financial crisis, the paper analyzes how exchange rate shocks experienced by overseas Filipino workers impact their home households. The study finds that an appreciation of a migrant's currency against the Philippine peso leads to increases in household remittances, with an estimated elasticity of 0.60. These positive income shocks result in increased human capital accumulation and entrepreneurship in origin households. Child schooling and educational expenditure rise, while child labor falls. In the area of entrepreneurship, households increase hours worked in self-employment and are more likely to start capital-intensive household enterprises. The paper also addresses concerns about the causal relationship between exchange rate shocks and household investment, finding that the results are robust to various econometric tests. The study highlights the importance of remittances in developing countries and provides insights into how households respond to unexpected economic shocks. The findings contribute to understanding how households in developing countries respond to transitory changes in economic conditions.