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The differential impact of international remittances on poverty in developing and advanced economies: policy implications and insights

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  • Van Bon Nguyen

    (Ho Chi Minh University of Banking (HUB))

Abstract

Remittances are crucial for economic development in developing economies, enhancing foreign exchange reserves and living standards. However, their impact on poverty varies between developing and advanced economies. Using PMG and difference GMM estimators on data from 36 developing and 30 advanced economies from 2005 to 2023, we find that remittances reduce poverty in developing economies but worsen it in advanced ones. Trade openness also shows contrasting effects: it alleviates poverty in advanced economies but exacerbates it in developing ones. Meanwhile, economic growth and infrastructure development reduce poverty. These insights highlight key policy implications for governments in developing and advanced economies leveraging remittances to fight against poverty effectively.

Suggested Citation

  • Van Bon Nguyen, 2025. "The differential impact of international remittances on poverty in developing and advanced economies: policy implications and insights," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 15(3), pages 517-535, September.
    • Handle: RePEc:spr:eurase:v:15:y:2025:i:3:d:10.1007_s40822-025-00314-1
    DOI: 10.1007/s40822-025-00314-1
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