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Brain drain or brain gain? investigating the diaspora’s effect on the economy and real estate bubble: new evidence from Kenya based on ARDL analysis

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  • Bamahriz, Omar
  • Masih, Mansur

Abstract

The diaspora has often been castigated for the real estate bubble as a greater part of their remittances is invested in property. We therefore want to identify the relationship between these remittances, real estate prices and the GDP and employ the ARDL model to try and investigate whether there exists a long run relationship between them. This we believe would make a significant contribution to both the policy makers and academia due to scarce literature focused on the diaspora’s effect on the real estate prices in their home countries. We find no causal relationship between the remittances and the real estate bubble but find a trade-off in using the exchange rate to make housing more affordable at the expense of economic growth.

Suggested Citation

  • Bamahriz, Omar & Masih, Mansur, 2018. "Brain drain or brain gain? investigating the diaspora’s effect on the economy and real estate bubble: new evidence from Kenya based on ARDL analysis," MPRA Paper 87556, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:87556
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    References listed on IDEAS

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    6. Nadeem U. Haque & Se-Jik Kim, 1995. "“Human Capital Flight”: Impact of Migration on Income and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 42(3), pages 577-607, September.
    7. Juthathip Jongwanich, 2007. "Workers’ Remittances, Economic Growth and Poverty in Developing Asia and the Pacific Countries," MPDD Working Paper Series WP/07/01, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    remittances; real estate prices; economic growth; ARDL;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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