Author: Mr. Kangni R Kpodar
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 43
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Book Description
Using a new quarterly panel database on remittances (71 countries over the period 2011Q1- 2020Q4), this paper investigates the elasticity of remittances to transaction costs in a high frequency and dynamic setting. It adds to the literature by systematically exploring the heterogeneity in the cost-elasticity of remittances along several country characteristics. The findings suggest that cost reductions have a short-term positive impact on remittances, that dissipates beyond one quarter. According to our estimates, reducing transaction costs to the Sustainable Development Goal target of 3 percent could generate an additional US$32bn in remittances, higher that the direct cost savings from lower transaction costs, thus suggesting an absolute elasticity greater than one. Among remittance cost-mitigation factors, higher competition in the remittance market, a deeper financial sector, and adequate correspondent banking relationships are associated with a lower elasticity of remittance to transaction costs. Similarly, remittance cost-adaptation factors such as enhanced transparency in remittance costs, improved financial literary and higher ICT development coincide with remittances being less sensitive to transaction costs. Supplementing the panel analysis, the use of micro data from the USA-Mexico corridor confirm that migrants facing higher transaction costs tend to remit less, and that this effect is less pronounced for skilled migrants and those that have access to a bank account.
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: Samuel Munzele Maimbo
Publisher: World Bank Publications
ISBN: 0821357948
Category : Business & Economics
Languages : en
Pages : 402
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Book Description
Migrants have long faced unwarranted constraints to sending money to family members and relatives in their home countries, among them costly fees and commissions, inconvenient formal banking hours, and inefficient domestic banking services that delay final payment to the beneficiaries. Yet such remittances are perhaps the largest source of external finance in developing countries. Officially recorded remittance flows to developing countries exceeded US$125 billion in 2004, making them the second largest source of development finance after foreign direct investment. This book demonstrates that governments in developing countries increasingly recognize the importance of remittance flows and are quickly addressing these constraints.
Author: Oliver E. Williamson
Publisher: Edward Elgar Publishing
ISBN: 9780857938756
Category : Industrial organization (Economic theory).
Languages : en
Pages : 0
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Book Description
Transaction cost economics has and continues to be a fruitful area of research. There is still much to be done in the field with past research being used in conjunction with the vast number of contractual phenomena that have yet to be investigated in transaction cost economics terms. New challenges are posed by the need to move beyond the design of new contractual instruments (such as financial derivatives) to include an examination of the lurking hazards that attend contract implementation.
Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1513592033
Category : Business & Economics
Languages : en
Pages : 33
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Book Description
Following the companion paper on the new policy challenges related to the adoption of digital forms of money, this paper presents an operational strategy for the IMF to continue delivering on its mandate of ensuring domestic and international financial and economic stability. The paper begins by summarizing the forces driving the adoption of digital forms of money, and the new policy questions that emerge. It then focusses on how the IMF’s core activities and output will need to evolve, including surveillance, capacity development, and analytical foundations. It ends by discusses how the IMF intends to partner with other organization, and to grow and structure internal resources to fulfill this vision.
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: Mr.Dong He
Publisher: International Monetary Fund
ISBN: 1484303776
Category : Business & Economics
Languages : en
Pages : 49
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Book Description
A new wave of technological innovations, often called “fintech,” is accelerating change in the financial sector. What impact might fintech have on financial services, and how should regulation respond? This paper sets out an economic framework for thinking through the channels by which fintech might provide solutions that respond to consumer needs for trust, security, privacy, and better services, change the competitive landscape, and affect regulation. It combines a broad discussion of trends across financial services with a focus on cross-border payments and especially the impact of distributed ledger technology. Overall, the paper finds that boundaries among different types of service providers are blurring; barriers to entry are changing; and improvements in cross-border payments are likely. It argues that regulatory authorities need to balance carefully efficiency and stability trade-offs in the face of rapid changes, and ensure that trust is maintained in an evolving financial system. It also highlights the importance of international cooperation.
Author: Asian Development Bank
Publisher: Asian Development Bank
ISBN: 9292629638
Category : Business & Economics
Languages : en
Pages : 74
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Book Description
Remittances are considered a lifeline of developing countries and are especially vital for migrants and their families. Digital data technology can help alleviate many of the “pain-points” in the remittances industry. For example, it can significantly enhance the convenience, speed, security, and affordability of sending and receiving remittances. This report discusses the importance of remittances in Asia and the Pacific, the key challenges faced by the industry, and the impacts of the coronavirus disease (COVID-19 pandemic. It also includes country case studies that demonstrate the benefits of digitization and makes recommendations on how the digitization of remittances across the region can be further advanced.
Author: Ms. Alina Carare
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 29
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Book Description
This paper investigates factors that predict variation in digital and non-digital remittance fees over time and across countries, exploring differences between CAPDR and other regions. The paper fills a void in the literature on how country- and corridor-specific factors relate to remittance fees at different levels of digitalization of the transaction mode. It also complements stylized facts and regression analysis with a survey analysis of the CAPDR authorities’ views on the latest developments, possibilities, and risks related to digital remittances with a view to gauging the authorities’ potential role in further reducing the cost of cross-border payments more generally and remittances fees in particular. The paper finds a clear trend of declining remittance fees across countries and at any level of digitalization, albeit they remain higher for CAPDR countries relative to non-CAPDR countries. More competition, financial and digital development in receiving countries—such as debit/credit card ownership or bank branch penetration—are associated with lower remittance fees, especially in CAPDR. The surveyed authorities actively explore the use of digital money to advance domestic payment systems, expedite financial inclusion, and lower remittances fees, yet see considerable risks, especially for preserving monetary sovereignty in CAPDR.
Author: Emiko Todoroki
Publisher: World Bank Publications
ISBN: 1464801096
Category : Business & Economics
Languages : en
Pages : 267
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Book Description
Migrant workers routinely send small sums back to their families -- often a crucial lifeline for their survivial. But sending money across countries for these low income people is not easy and often very expensive and risky. Better regulation and supervision of these payment channels can make the process easier to access and more secure.
