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The macroeconomic determinants of remittances in Bangladesh

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  • Hasan, Mohammad Monirul

Abstract

This paper examines the macroeconomic determinants of workers’ remittances in Bangladesh. Various regressions in the paper find that the macroeconomic variables such as inflation, interest rate, exchange rate of Bangladesh and GDP of the five remittance sending countries have significant impact on remittance. In the analysis it is found that if the domestic interest rate goes up by 1%, on average, then the remittance will increase by 1.94%. Therefore, remittance in Bangladesh is very responsive to changes in the domestic interest rate. Again, if the GDP of the rest of the five countries increases by 1%, then remittance will increase by 3.06 %

Suggested Citation

  • Hasan, Mohammad Monirul, 2008. "The macroeconomic determinants of remittances in Bangladesh," MPRA Paper 27744, University Library of Munich, Germany, revised Sep 2010.
    • Handle: RePEc:pra:mprapa:27744
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    References listed on IDEAS

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    1. Nicholas P. Glytsos, 1997. "Remitting Behaviour of “Temporary” and “Permanent” Migrants: The Case of Greeks in Germany and Australia," LABOUR, CEIS, vol. 11(3), pages 409-435, November.
    2. El-Sakka, M. I. T. & McNabb, Robert, 1999. "The Macroeconomic Determinants of Emigrant Remittances," World Development, Elsevier, vol. 27(8), pages 1493-1502, August.
    3. Lucas, Robert E B & Stark, Oded, 1985. "Motivations to Remit: Evidence from Botswana," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 901-918, October.
    4. Glytsos, Nicholas & Katseli, Louka Tarsitsa, 1986. "Theoretical and Empirical Determinants of International Labour Mobility: A Greek-German Perspective," CEPR Discussion Papers 148, C.E.P.R. Discussion Papers.
    5. Faini, Riccardo, 1994. "Workers Remittances and the Real Exchange Rate: A Quantitative Framework," Journal of Population Economics, Springer;European Society for Population Economics, vol. 7(2), pages 235-245.
    6. Matthew Higgins & Alketa Hysenbegasi & Susan Pozo, 2004. "Exchange-rate uncertainty and workers' remittances," Applied Financial Economics, Taylor & Francis Journals, vol. 14(6), pages 403-411.
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    Cited by:

    1. World Bank, 2012. "Bangladesh - Towards Accelerated, Inclusive and Sustainable Growth : Opportunities and Challenges, Volume 2. Main Report," World Bank Publications - Reports 12121, The World Bank Group.
    2. Ebenezer A. Olubiyi & Kubrat O. Kehinde, 2015. "Does Exchange Rate Affect Remittances in Nigeria?," The Review of Finance and Banking, Academia de Studii Economice din Bucuresti, Romania / Facultatea de Finante, Asigurari, Banci si Burse de Valori / Catedra de Finante, vol. 7(1), pages 031-045, June.
    3. Bezon Kumar & Md. Elias Hossain & Md. Ataul Gani Osmani, 2018. "Utilization of International Remittances in Bangladesh," Remittances Review, Remittances Review, vol. 3(1), pages 5-18, May.
    4. Mohammed Ziaul Haider & Tanbir Hossain & Ohidul Islam Siddiqui, 2016. "Impact of Remittance on Consumption and Savings Behavior in Rural Areas of Bangladesh," Journal of Business, LAR Center Press, vol. 1(4), pages 25-34, September.

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    More about this item

    Keywords

    Remittance; inflation; interest rate; exchange rate;
    All these keywords.

    JEL classification:

    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • P24 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - National Income, Product, and Expenditure; Money; Inflation
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances

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