Remittances and Economic Growth in Africa, Asia, and Latin American-Caribbean Countries: A Panel Unit Root and Panel Cointegration Analysis
AbstractThis study estimates the macroeconomic impact of remittances and some control variables such as openness of the economy, capital/labor ratio, and economic freedom on the economic growth of African, Asian, and Latin American-Caribbean countries using newly developed panel unit-root tests, cointegration tests, and Panel Fully Modified OLS (PFMOLS). We use annual panel data from 1985- 2007for 64 countries consisting of 29 from Africa, 14 from Asia, and 21 from Latin America and the Caribbean region, respectively. We find that remittances, openness of the economy, and capital labor ratio have positive and significant effect on economic growth for all regions as a group and in each of the three in study. While the economic freedom index also has a positive and significant effect on growth in Africa and Latin America, however, its effect on the economic growth of Asia is mixed.
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Bibliographic InfoPaper provided by Middle Tennessee State University, Department of Economics and Finance in its series Working Papers with number 201103.
Date of creation: Jun 2011
Date of revision:
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Web page: http://www.mtsu.edu/~berc/working/Economics_Working_Papers.html
More information through EDIRC
Workers’ Remittances; Economic Growth; Unit-Root tests; Error Correction Model; PFMOLS; Panel Data; Africa; Asia; Latin America/Caribbean;
Other versions of this item:
- Christian Nsiah & Bichaka Fayissa, 2013. "Remittances and economic growth in Africa, Asia, and Latin American-Caribbean countries: a panel unit root and panel cointegration analysis," Journal of Economics and Finance, Springer, vol. 37(3), pages 424-441, July.
- E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
This paper has been announced in the following NEP Reports:
- NEP-AFR-2011-06-11 (Africa)
- NEP-ALL-2011-06-11 (All new papers)
- NEP-FDG-2011-06-11 (Financial Development & Growth)
- NEP-MAC-2011-06-11 (Macroeconomics)
- NEP-MIG-2011-06-11 (Economics of Human Migration)
- NEP-SEA-2011-06-11 (South East Asia)
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