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Do remittances dampen the effect of natural disasters on output growth volatility in developing countries?

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  • Christian EBEKE
  • Jean-Louis COMBES

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Abstract

This paper analyzes the impact of natural disasters on the output growth volatility. Using a large sample of developing countries and mobilizing a dynamic panel data framework, it uncovers a diminishing macroeconomic destabilizing consequence of natural disasters as remittance inflows rise. It appears that the effect of natural disasters disappears for a remittance ratio above 8% of GDP. However, remittances aggravate the destabilizing effects of natural disasters when they exceed 17% of GDP.

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File URL: http://publi.cerdi.org/ed/2010/2010.31.pdf
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Bibliographic Info

Paper provided by CERDI in its series Working Papers with number 201031.

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Length: 28
Date of creation: 2010
Date of revision:
Handle: RePEc:cdi:wpaper:1207

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Keywords: Natural disasters; output growth volatility; Remittances;

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  1. Julian di Giovanni & Andrei A. Levchenko, 2006. "Trade Openness and Volatility," Development Working Papers 219, Centro Studi Luca d\'Agliano, University of Milano.
  2. Combes, Jean-Louis & Ebeke, Christian, 2011. "Remittances and Household Consumption Instability in Developing Countries," World Development, Elsevier, vol. 39(7), pages 1076-1089, July.
  3. Bekaert, Geert & Harvey, Campbell R. & Lundblad, Christian, 2006. "Growth volatility and financial liberalization," Journal of International Money and Finance, Elsevier, vol. 25(3), pages 370-403, April.
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