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Remittance Behavior of Migrants and its Macroeconomic Effects in Four Developing Countries

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  • Anupam Das

    (Mount Royal University, Canada)

Abstract

The literature on the macroeconomic effects of remittances is inconclusive. This study establishes a relationship between remittances and other important macroeconomic variables, such as consumption, investment and economic growth in Bangladesh, Egypt, Pakistan, and Syria over the period 1975-2006. Overall results suggest that remittances have a positive impact on economic growth in Pakistan and Syria but a negative impact in Bangladesh and Egypt. Negative remittance-growth coefficients in those two countries suggest a counter-cyclical relationship. A key objective of this paper is to identify how the remittance behavior of migrants varies across countries. Results from panel estimation procedure shows that a combination of self-interest and enlightened self-interest behavior of migrants is responsible for the growth impact in Bangladesh. The enlightened self-interest motivation is also the most likely cause of the growth impact in Egypt. Finally, the self-interest behavior explains the growth impacts in Pakistan and Syria. Results from this paper have policy implications for developing countries which face dilemmas and debates on the impact of remittances on economic growth.

Suggested Citation

  • Anupam Das, 2012. "Remittance Behavior of Migrants and its Macroeconomic Effects in Four Developing Countries," International Journal of Applied Behavioral Economics (IJABE), IGI Global, vol. 1(1), pages 41-59, January.
  • Handle: RePEc:igg:jabe00:v:1:y:2012:i:1:p:41-59
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    Cited by:

    1. Mohammad Salahuddin & Jeff Gow, 2015. "The relationship between economic growth and remittances in the presence of cross-sectional dependence," Journal of Developing Areas, Tennessee State University, College of Business, vol. 49(1), pages 207-221, January-M.
    2. Tchantchane, A. & Rodrigues, G. & Fortes, P.C., 2013. "An Empirical Study on the importance of Remittance and Educational Expenditure on Growth: Case of the Philippines," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 13(1), pages 173-186.
    3. repec:rsr:supplm:v:65:y:2017:i:6:p:134-143 is not listed on IDEAS

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