IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-20-00550.html
   My bibliography  Save this article

Remittances and inflation in OPEC countries:Evidence from bias-corrected least-squares dummy variable (CLSDV) estimator

Author

Listed:
  • Rashid Sbia

    (Aix-Marseille University, CNRS, EHESS, Centrale Marseille,)

  • Helmi Hamdi

    (CERGAM EA4225 Aix-Marseille Universite)

Abstract

The aim of this paper is to investigate the impact of remittances outflows on inflation for a panel of 14 OPEC countries during the period 1980-2018. Using bias-corrected least-squares dummy variable (CLSDV) estimator, empirical results reveal that remittance outflows have no effect on inflation rate. However, trade openness and current account deficits have a positive impact on inflation. Further, oil price appears to not have any effect on inflation in OPEC countries.

Suggested Citation

  • Rashid Sbia & Helmi Hamdi, 2020. "Remittances and inflation in OPEC countries:Evidence from bias-corrected least-squares dummy variable (CLSDV) estimator," Economics Bulletin, AccessEcon, vol. 40(3), pages 2471-2483.
    • Handle: RePEc:ebl:ecbull:eb-20-00550
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/Pubs/EB/2020/Volume40/EB-20-V40-I3-P216.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. David Romer, 1993. "Openness and Inflation: Theory and Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(4), pages 869-903.
    2. Aisen, Ari & Veiga, Francisco Jose, 2006. "Does Political Instability Lead to Higher Inflation? A Panel Data Analysis," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 38(5), pages 1379-1389, August.
    3. Termos, Ali & Naufal, George & Genc, Ismail, 2013. "Remittance outflows and inflation: The case of the GCC countries," Economics Letters, Elsevier, vol. 120(1), pages 45-47.
    4. Giovanni S. F. Bruno, 2005. "Estimation and inference in dynamic unbalanced panel-data models with a small number of individuals," Stata Journal, StataCorp LLC, vol. 5(4), pages 473-500, December.
    5. Hathroubi, Salem & Aloui, Chaker, 2016. "On interactions between remittance outflows and Saudi Arabian macroeconomy: New evidence from wavelets," Economic Modelling, Elsevier, vol. 59(C), pages 32-45.
    6. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    7. Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
    8. Kim, MinKyoung & Beladi, Hamid, 2005. "Is free trade deflationary?," Economics Letters, Elsevier, vol. 89(3), pages 343-349, December.
    9. Hamdi, Helmi & Sbia, Rashid, 2013. "Dynamic relationships between oil revenues, government spending and economic growth in an oil-dependent economy," Economic Modelling, Elsevier, vol. 35(C), pages 118-125.
    10. Paresh Kumar Narayan & Seema Narayan & Sagarika Mishra, 2011. "Do Remittances Induce Inflation? Fresh Evidence from Developing Countries," Southern Economic Journal, Southern Economic Association, vol. 77(4), pages 914-933, April.
    11. Bruno, Giovanni S.F., 2005. "Approximating the bias of the LSDV estimator for dynamic unbalanced panel data models," Economics Letters, Elsevier, vol. 87(3), pages 361-366, June.
    12. Mahir Binici & Yin-Wong Cheung & Kon S. Lai, 2011. "Trade Openness, Market Competition, and Inflation: Some Sectoral Evidence from OECD Countries," CESifo Working Paper Series 3690, CESifo.
    13. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    14. Desai, Raj M. & Olofsgård, Anders & Yousef, Tarik M., 2003. "Democracy, Inequality, and Inflation," American Political Science Review, Cambridge University Press, vol. 97(3), pages 391-406, August.
    15. Paresh Kumar Narayan & Seema Narayan & Sagarika Mishra, 2011. "Do Remittances Induce Inflation? Fresh Evidence from Developing Countries," Southern Economic Journal, John Wiley & Sons, vol. 77(4), pages 914-933, April.
    16. Bun, Maurice J. G. & Kiviet, Jan F., 2003. "On the diminishing returns of higher-order terms in asymptotic expansions of bias," Economics Letters, Elsevier, vol. 79(2), pages 145-152, May.
    17. Richard W. Evans, 2007. "Is openness inflationary? Imperfect competition and monetary market power," Globalization Institute Working Papers 01, Federal Reserve Bank of Dallas.
    18. Magda Kandil & Hanan Morsy, 2011. "Determinants of Inflation in GCC," Middle East Development Journal, Taylor & Francis Journals, vol. 3(2), pages 141-158, January.
    19. Régis Barnichon & Shanaka J. Peiris, 2008. "Sources of Inflation in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 17(5), pages 729-746, November.
    20. Lane, Philip R., 1997. "Inflation in open economies," Journal of International Economics, Elsevier, vol. 42(3-4), pages 327-347, May.
    21. Kiviet, Jan F., 1995. "On bias, inconsistency, and efficiency of various estimators in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 68(1), pages 53-78, July.
    22. Alkhathlan, Khalid A., 2013. "The nexus between remittance outflows and growth: A study of Saudi Arabia," Economic Modelling, Elsevier, vol. 33(C), pages 695-700.
    23. William Gruben & Darryl Mcleod, 2004. "The openness-inflation puzzle revisited," Applied Economics Letters, Taylor & Francis Journals, vol. 11(8), pages 465-468.
    24. International Monetary Fund, 2010. "Commodity Prices and Inflation in the Middle East, North Africa, and Central Asia," IMF Working Papers 2010/135, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mahir Binici & Yin-Wong Cheung & Kon S. Lai, 2011. "Trade Openness, Market Competition, and Inflation: Some Sectoral Evidence from OECD Countries," CESifo Working Paper Series 3690, CESifo.
    2. Emna Trabelsi, 2016. "Transparency on inflation of OECD countries? An Application of LSDVC Estimator on a dynamic Panel Model," Economics Bulletin, AccessEcon, vol. 36(2), pages 1095-1126.
    3. Emna Trabelsi, 2016. "What effects exert Economic Globalization and Central Bank Transparency on inflation of OECD countries? An Application of LSDVC Estimator on a dynamic Panel Model," Working Papers hal-01157387, HAL.
    4. Roberto Dell'Anno & Adalgiso Amendola, 2015. "Social Exclusion and Economic Growth: An Empirical Investigation in European Economies," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 61(2), pages 274-301, June.
    5. Muhammad Ayyoub & Julia Wörz, 2021. "Inflation‐growth nexus in developing economies: New empirical evidence from a disaggregated approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 241-257, January.
    6. Gehringer, Agnieszka & Prettner, Klaus, 2019. "Longevity And Technological Change," Macroeconomic Dynamics, Cambridge University Press, vol. 23(4), pages 1471-1503, June.
    7. Christoph S. Weber, 2018. "Central bank transparency and inflation (volatility) – new evidence," International Economics and Economic Policy, Springer, vol. 15(1), pages 21-67, January.
    8. Francesco Bogliacino & Mariacristina Piva & Marco Vivarelli, 2011. "The impact of R&D on employment in Europe: A firm-level analysis," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1176, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    9. Francesco Bogliacino & Mariacristina Piva & Marco Vivarelli, 2014. "Technology and employment: the job creation effect of business R&D," Rivista Internazionale di Scienze Sociali, Vita e Pensiero, Pubblicazioni dell'Universita' Cattolica del Sacro Cuore, vol. 122(3), pages 239-264.
    10. Dosi, G. & Piva, M. & Virgillito, M.E. & Vivarelli, M., 2021. "Embodied and disembodied technological change: The sectoral patterns of job-creation and job-destruction," Research Policy, Elsevier, vol. 50(4).
    11. Kok, Christoffer & Mirza, Harun & Pancaro, Cosimo, 2019. "Macro stress testing euro area banks’ fees and commissions," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 61(C), pages 97-119.
    12. Ibrahim, Mansor H. & Salim, Kinan & Abojeib, Moutaz & Yeap, Lau Wee, 2019. "Structural changes, competition and bank stability in Malaysia’s dual banking system," Economic Systems, Elsevier, vol. 43(1), pages 111-129.
    13. Zier, Patrick & Petrick, Martin, 2010. "Cap Reform And The Effects Of Direct Payments On Heterogeneous Farm Structures In East Germany," 50th Annual Conference, Braunschweig, Germany, September 29-October 1, 2010 93948, German Association of Agricultural Economists (GEWISOLA).
    14. Ghosh, Amit, 2014. "How do openness and exchange-rate regimes affect inflation?," International Review of Economics & Finance, Elsevier, vol. 34(C), pages 190-202.
    15. Blanka Skrabic Peric & Zana Vidovic, 2017. "Heterogeneous Panel Granger causality between GDP and Tourism in 11 EU members in Central and Southeastern Europe," Eastern European Business and Economics Journal, Eastern European Business and Economics Studies Centre, vol. 3(1), pages 6-27.
    16. Idris, Zera Zuryana & Ismail, Normaz Wana & Ibrahim, Saifuzzaman & Hamzah, Hanny Zurina, 2021. "High-Technology Trade: Does it Enhance National Competitiveness?," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 55(3), pages 35-48.
    17. Mariacristina Piva & Marco Vivarelli, 2018. "Is Innovation Destroying Jobs? Firm-Level Evidence from the EU," Sustainability, MDPI, vol. 10(4), pages 1-16, April.
    18. Felix Hammermann & Mark Flanagan, 2009. "What explains persistent inflation differentials across transition economies?1," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 17(2), pages 297-328, April.
    19. Căpraru, Bogdan & Georgescu, George & Sprincean, Nicu, 2022. "Do independent fiscal institutions cause better fiscal outcomes in the European Union?," Economic Systems, Elsevier, vol. 46(2).
    20. Piva, Mariacristina & Vivarelli, Marco, 2017. "Technological Change and Employment: Were Ricardo and Marx Right?," IZA Discussion Papers 10471, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • F1 - International Economics - - Trade
    • F3 - International Economics - - International Finance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-20-00550. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John P. Conley (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.