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Workers’ Remittances

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Author Info

  • Adolfo Barajas
  • Ralph Chami
  • Christian Ebeke
  • Sampawende J.-A. Tapsoba

Abstract

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.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 12/251.

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Length: 25
Date of creation: 19 Oct 2012
Date of revision:
Handle: RePEc:imf:imfwpa:12/251

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Related research

Keywords: Workers remittances; Business cycles; Terms of trade; Capital inflows; Business Cycle Synchronization; Spillovers.; remittance flows; remittance inflows; real gdp; migration; bilateral remittance; impact of remittances; effect of remittance; migrant; effect of remittances; remittance channel; workers ? remittances; economic growth; bilateral remittances; remittance outflows; gdp growth; determinants of remittances; remittance data; growth rate; remittance sending; immigrant remittance; remittances data; role of remittance; variation in remittances; remittance sending countries; effects of remittances; contribution of remittances; remittances inflows; role of remittances; trade-to-gdp ratio; remittance receiving; gross domestic product; value of remittance; amount of remittances; bilateral remittance data; business cycle measures; remittance receiving country; impact of remittances on growth; correlation of business cycles;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  1. Beata S. Javorcik & Çaglar Özden & Mariana Spatareanu & Cristina Neagu, 2006. "Migrant Networks and Foreign Direct Investment," Working Papers Rutgers University, Newark 2006-003, Department of Economics, Rutgers University, Newark.
  2. Markus Brückner, 2013. "On the simultaneity problem in the aid and growth debate," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 28(1), pages 126-150, 01.
  3. Rao, B.Bhaskara & Hassan, Gazi, 2009. "A panel data analysis of the growth effects of remittances," MPRA Paper 18021, University Library of Munich, Germany.
  4. Todd E. Clark & Eric van Wincoop, 1999. "Borders and business cycles," Research Working Paper 99-07, Federal Reserve Bank of Kansas City.
  5. Giuliano, Paola & Ruiz-Arranz, Marta, 2006. "Remittances, Financial Development, and Growth," IZA Discussion Papers 2160, Institute for the Study of Labor (IZA).
  6. Samir Jahjah & Ralph Chami & Connel Fullenkamp, 2003. "Are Immigrant Remittance Flows a Source of Capital for Development," IMF Working Papers 03/189, International Monetary Fund.
  7. Cerqueira, Pedro André & Martins, Rodrigo, 2009. "Measuring the determinants of business cycle synchronization using a panel approach," Economics Letters, Elsevier, vol. 102(2), pages 106-108, February.
  8. Frankel, Jeffrey A., 2011. "Are Bilateral Remittances Countercyclical?," Scholarly Articles 9642640, Harvard Kennedy School of Government.
  9. César Calderón & Alberto Chong & Ernesto Stein, 2002. "Trade Intensity and Business Cycle Synchronization: Are Developing Countries Any Different?," Working Papers Central Bank of Chile 195, Central Bank of Chile.
  10. Christian Hubert Ebeke, 2011. "Do Remittances Lead to a Public Moral Hazard in Developing Countries? An Empirical Investigation," Journal of Development Studies, Taylor & Francis Journals, vol. 48(8), pages 1009-1025, May.
  11. Frankel, Jeffrey A., 2010. "Are Bilateral Remittances Countercyclical?," Scholarly Articles 4450131, Harvard Kennedy School of Government.
  12. Christian EBEKE & Jean-Louis COMBES, 2010. "Remittances and Household Consumption Instability in Developing Countries," Working Papers 201015, CERDI.
  13. Frankel, Jeffrey A & Rose, Andrew K, 1996. "The Endogeneity of the Optimum Currency Area Criteria," CEPR Discussion Papers 1473, C.E.P.R. Discussion Papers.
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  15. Beine, Michel & Lodigiani, Elisabetta & Vermeulen, Robert, 2012. "Remittances and financial openness," Regional Science and Urban Economics, Elsevier, vol. 42(5), pages 844-857.
  16. Christian Hubert EBEKE, 2011. "Remittances, Countercyclicality, Openness and Government Size," Discussion Papers (REL - Recherches Economiques de Louvain) 2011044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  17. Flood, Robert P. & Rose, Andrew K., 2010. "Inflation targeting and business cycle synchronization," Journal of International Money and Finance, Elsevier, vol. 29(4), pages 704-727, June.
  18. S. Jules-Armand Tapsoba, 2009. "Trade Intensity and Business Cycle Synchronicity in Africa," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 18(2), pages 287-318, March.
  19. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2000. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," NBER Working Papers 7831, National Bureau of Economic Research, Inc.
  20. M. Ayhan Kose & Eswar Prasad & Marco Terrones, 2003. "How Does Globalization Affect the Synchronization of Business Cycles?," IMF Working Papers 03/27, International Monetary Fund.
  21. Yasser Abdih & Ralph Chami & Christian Ebeke & Adolfo Barajas, 2012. "Remittances Channel and Fiscal Impact in the Middle East, North Africa, and Central Asia," IMF Working Papers 12/104, International Monetary Fund.
  22. Nathan Nunn & Leonard Wantchekon, 2011. "The Slave Trade and the Origins of Mistrust in Africa," American Economic Review, American Economic Association, vol. 101(7), pages 3221-52, December.
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  25. Nunn, Nathan & Wantchekon, Leonard, 2011. "The Slave Trade and the Origins of Mistrust in Africa," Scholarly Articles 11986331, Harvard University Department of Economics.
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Citations

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Cited by:
  1. Bettin, Giulia & Presbitero, Andrea F. & Spatafora, Nikola, 2014. "Remittances and vulnerability in developing countries," Policy Research Working Paper Series 6812, The World Bank.
  2. Mthuli Ncube & Zuzana Brixiova, 2013. "Working Paper 188 - Remittances and their Macroeconomic Impact: Evidence from Africa," Working Paper Series 996, African Development Bank.

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