Working Paper 188 - Remittances and their Macroeconomic Impact: Evidence from Africa
AbstractThis paper examines macroeconomic trends, drivers and impact of remittances in Africa. First, it documents the increasing share of remittances relative to other foreign capital flows to Africa, distribution of remittance inflows across countries, and some key properties. This is followed by some analysis of the macroeconomic drivers of remittances in recipient countries, such as the level of income, inflation and nominal exchange rate depreciation. Specifically, remittances are positively impacted by higher income, but deterred by an unstable macroeconomic environment, pointing to the investment motive in remitting to Africa. The paper also examines the role of remittances in funding Africa’s external balances. Finally, drawing on the case of Egypt, the paper shows the positive impact that rising remittances can have on public debt sustainability.
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Bibliographic InfoPaper provided by African Development Bank in its series Working Paper Series with number 996.
Date of creation: 23 Dec 2013
Date of revision:
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-12-29 (All new papers)
- NEP-ARA-2013-12-29 (MENA - Middle East & North Africa)
- NEP-MAC-2013-12-29 (Macroeconomics)
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