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Do remittances spur economic growth in Africa?

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  • Taiwo, Kayode

Abstract

Remittance flows to developing countries are now triple official development assistance and larger than foreign direct investment. The surge in remittances now occupies important position in development equation as remittances are seen as cheap resources for development. African governments are no exception among developing nations chasing remittances. Policymakers are making efforts to attract remittances to provide needed resources for economic transformation. In this study, an attempt is made to explore the impact of remittance flows on economic growth in Africa, considering efforts at attracting remittances. The impact of remittances is estimated using static and dynamic panel methods with data spanning 1975 to 2015. The study finds that remittances do not have an impact on economic growth in Africa. This conclusion is hinged on measurement issues, internal conditions, labour market implications, and the effect of remittances on tradable sectors.

Suggested Citation

  • Taiwo, Kayode, 2020. "Do remittances spur economic growth in Africa?," MPRA Paper 111029, University Library of Munich, Germany, revised 2021.
    • Handle: RePEc:pra:mprapa:111029
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    More about this item

    Keywords

    Migration; Remittances; Economic growth; Panel data; Africa;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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