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Author: Anna Miller
Publisher: GRIN Verlag
ISBN: 365642750X
Category : Business & Economics
Languages : en
Pages : 14
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Book Description
Seminar paper from the year 2013 in the subject Economics - Job market economics, grade: 64%, University of Nottingham (Economics), course: MSc in Applied Economics and Financial Economics, language: English, abstract: Besides foreign direct investment (FDI) and capital market flows, workers’ remittances are another external channel for capital flows. According to the OECD, remittances to developing countries amounted to US$ 149.4 billion in the year 2002. However, whereas FDI and capital market flows are subject to variation due to recessions in home countries, remittances are steadily rising every year (OECD, 2006), reaching an amount of about UD$ 300 billion in the year 2007 (Barajas et al., 2009). To give a brief definition, remittances are money transfers from migrants working abroad to their families in their home countries. Yet, the question is, do these remittances contribute to or boost economic growth in receiving countries or are they only a means to increase the migrants’ families’ welfare by directly reducing their poverty and raising the living standard (Rao and Hassan, 2011). In other words, are remittances mostly used for consumption or do they rather flow in education, and thereby contribute to the human capital, and in investments, thus increasing the capital stock in the economy (Giuliano and Ruiz-Arranz, 2009)? From the growth theory we know that consumption does not have any impact on growth, only investments, either in production or in human capital, can affect long-run growth. Evidence from Indonesia, Ecuador, and Argentina (Sayan, 2006) shows that remittances indirectly reduce volatility of growth of output in times of crises and increase the growth rate thereby (Rao and Hassan, 2011). In contrast, Sayan (2006) found that remittances are moving procyclically with out in recipient countries, boosting incomes during booms, but reducing them even more during recessions and thus magnifying the economic crisis. This paper examines the relationship between remittances and GDP growth using in a macro panel with 67 countries and a time period of 28 years, from 1975 through 2002, as well as a cross-section analysis for comparison. The goal of this analysis is to determine whether, and to what extent, remittances have an impact on long-term economic growth and, if so, whether this relation is significant or not.
Author: Anna Miller
Publisher: GRIN Verlag
ISBN: 365642750X
Category : Business & Economics
Languages : en
Pages : 14
Get Book Here
Book Description
Seminar paper from the year 2013 in the subject Economics - Job market economics, grade: 64%, University of Nottingham (Economics), course: MSc in Applied Economics and Financial Economics, language: English, abstract: Besides foreign direct investment (FDI) and capital market flows, workers’ remittances are another external channel for capital flows. According to the OECD, remittances to developing countries amounted to US$ 149.4 billion in the year 2002. However, whereas FDI and capital market flows are subject to variation due to recessions in home countries, remittances are steadily rising every year (OECD, 2006), reaching an amount of about UD$ 300 billion in the year 2007 (Barajas et al., 2009). To give a brief definition, remittances are money transfers from migrants working abroad to their families in their home countries. Yet, the question is, do these remittances contribute to or boost economic growth in receiving countries or are they only a means to increase the migrants’ families’ welfare by directly reducing their poverty and raising the living standard (Rao and Hassan, 2011). In other words, are remittances mostly used for consumption or do they rather flow in education, and thereby contribute to the human capital, and in investments, thus increasing the capital stock in the economy (Giuliano and Ruiz-Arranz, 2009)? From the growth theory we know that consumption does not have any impact on growth, only investments, either in production or in human capital, can affect long-run growth. Evidence from Indonesia, Ecuador, and Argentina (Sayan, 2006) shows that remittances indirectly reduce volatility of growth of output in times of crises and increase the growth rate thereby (Rao and Hassan, 2011). In contrast, Sayan (2006) found that remittances are moving procyclically with out in recipient countries, boosting incomes during booms, but reducing them even more during recessions and thus magnifying the economic crisis. This paper examines the relationship between remittances and GDP growth using in a macro panel with 67 countries and a time period of 28 years, from 1975 through 2002, as well as a cross-section analysis for comparison. The goal of this analysis is to determine whether, and to what extent, remittances have an impact on long-term economic growth and, if so, whether this relation is significant or not.
Author:
Publisher:
ISBN:
Category : Economic development
Languages : en
Pages : 26
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Book Description
Author:
Publisher: World Bank Publications
ISBN: 082136345X
Category :
Languages : en
Pages : 182
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Book Description
International migration, the movement of people across international boundaries to improve economic opportunity, has enormous implications for growth and welfare in both origin and destination countries. An important benefit to developing countries is the receipt of remittances or transfers from income earned by overseas emigrants. Official data show that development countries' remittance receipts totaled 160 billion in 2004, more than twice the size of official aid. This year's edition of Global Economic Prospects focuses on remittances and migration. The bulk of the book covers remittances.
Author: Michael T. Gapen
Publisher: INTERNATIONAL MONETARY FUND
ISBN: 9781451873009
Category :
Languages : en
Pages : 22
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Book Description
Over the past decades, workers' remittances have grown to become one of the largest sources of financial flows to developing countries, often dwarfing other widely-studied sources such as private capital and official aid flows. While it is undeniable that remittances have poverty-alleviating and consumption-smoothing effects on recipient households, a key empirical question is whether they also serve to promote long-run economic growth. This study tackles this question and addresses the main shortcomings of previous empirical work, focusing on the appropriate measurement, and incorporating an instrument that is both correlated with remittances and would only be expected to affect growth through its effect on remittances. The results show that, at best, workers' remittances have no impact on economic growth.
Author: Hector Perez-Saiz
Publisher: International Monetary Fund
ISBN: 1498324487
Category : Business & Economics
Languages : en
Pages : 37
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Book Description
We propose a simple macroeconomic model with input-output sectoral linkages based on Acemoglu et al. (2016) to quantify how changes in aggregate demand due to additional income from household’s remittances propagates through the network of input-output linkages in Sub-Saharan African countries. We first propose two network centrality measures to assess the role of some sectors as key input providers in the economy. Then, we use these measures to quantify the effect of sectoral linkages on sectoral and total output following an increase in remittances inflows. Our empirical results suggest that the effects of remittances on recipient economies increase with the degree of linkages across sectors, which is especially prominent in the case of the financial intermediation sector. Our paper contributes to the emerging macroeconomic literature on the propagation of shocks across sectors and the implications for the whole economy.
Author: Mr. Kangni R Kpodar
Publisher: International Monetary Fund
ISBN: 1513578456
Category : Business & Economics
Languages : en
Pages : 35
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Book Description
This paper provides an early assessment of the dynamics and drivers of remittances during the COVID-19 pandemic, using a newly compiled monthly remittance dataset for a sample of 52 countries, of which 16 countries with bilateral remittance data. The paper documents a strong resilience in remittance flows, notwithstanding an unprecedent global recession triggered by the pandemic. Using the local projection approach to estimate the impulse response functions of remittance flows during Jan 2020-Dec 2020, the paper provides evidence that: (i) remittances responded positively to COVID-19 infection rates in migrant home countries, underscoring its role as an important automatic stabilizer; (ii) stricter containment measures have the unintended consequence of dampening remittances; and (iii) a shift from informal to formal remittance channels due to travel restrictions appears to have also played a role in the surge in formal remittances. Lastly, the size of the fiscal stimulus in host countries is positively associated with remittances as the fiscal response cushions the economic impact of the pandemic.
Author: Connel Fullenkamp
Publisher: International Monetary Fund
ISBN: 1451925255
Category : Business & Economics
Languages : en
Pages : 94
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Book Description
Given the large size of aggregate remittance flows (billions of dollars annually), they should be expected to have significant macroeconomic effects on the economies that receive them. This paper directly addresses the two main issues of interest to policymakers with regard to remittances--how to manage their macroeconomic effects, and how to harness their development potential--by reporting the results of the first global study of the comprehensive macroeconomic effects of remittances on recipient economies. In broad terms, the findings of this paper tend to confirm the main benefit cited in the microeconomic literature: remittances improve households' welfare by lifting families out of poverty and insuring them against income shocks. The findings also yield a number of important caveats and policy considerations, however, that have largely been overlooked. The main challenge for policymakers in countries that receive significant flows of remittances is to design policies that promote remittances and increase their benefits while mitigating adverse side effects. Getting these policy prescriptions correct early on is imperative. Globalization and the aging of developed economy populations will ensure that demand for migrant workers remains robust for years to come. Hence, the volume of remittances likely will continue to grow, and with it, the challenge of unlocking the maximum societal benefit from these transfers.
Author: Mr.Ralph Chami
Publisher: International Monetary Fund
ISBN: 1451859635
Category : Business & Economics
Languages : en
Pages : 49
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Book Description
The role of remittances in development and economic growth is not well understood. This is partly because the literatures on the causes and effects of remittances remain separate. We develop a framework that links the motivation for remittances with their effect on economic activity. Because remittances take place under asymmetric information and economic uncertainty, there exists a significant moral hazard problem. The implication is that remittances have a negative effect on economic growth. We test this prediction using panel methods on a large sample of countries. The results indicate that remittances do have a negative effect on economic growth, which indicates that the moral hazard problem in remittances is severe.
Author: Mr.Adolfo Barajas
Publisher: International Monetary Fund
ISBN: 1475535821
Category : Business & Economics
Languages : en
Pages : 25
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Book Description
This paper shows that remittance flows significantly increase the business cycle synchronization between remittance-recipient countries and the rest of the world. Using both aggregate and bilateral remittances data in a panel data setting, the study demonstrates that this effect is robust and causal. Moreover, the econometric analysis reveals that remittance flows are more effective in channeling economic downturns than upswings from the sending countries to remittance-receiving economies. The analysis suggests that measures of openness and spillovers could be enhanced by accounting for the role of the remittances channel.
Author: Pablo Fajnzylber
Publisher: World Bank Publications
ISBN: 0821368710
Category : Business & Economics
Languages : en
Pages : 410
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Book Description
Workers' remittances have become a major source of financing for developing countries and are especially important in Latin America and the Caribbean, which is at the top of the ranking of remittance receiving regions in the world. While there has been a recent surge in analytical work on the topic, this book is motivated by the large heterogeneity in migration and remittance patterns across countries and regions, and by the fact that existing evidence for Latin America and the Caribbean is restricted to only a few countries, such as Mexico and El Salvador. Because the nature of the phenomenon varies across countries, its development impact and policy implications are also likely to differ in ways that are still largely unknown. This book helps fill the gap by exploring, in the specific context of Latin America and Caribbean countries, some of the main questions faced by policymakers when trying to respond to increasing remittances flows. The book relies on cross-country panel data and household surveys for 11 Latin American countries to explore the development impact of remittance flows along several dimensions: growth, poverty, inequality, schooling, health, labor supply, financial development, and real exchange rates.
