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Do international remittances cause Dutch disease?

Author

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  • Beja, Edsel Jr.

Abstract

Dutch disease is a condition whereby a booming export sector along with a concomitant strengthening of the non-tradable sector cause a deterioration in the rest of the tradable sector. Regression analysis finds that Dutch disease due to international remittances appears to afflict the developing countries more than the upper income countries. Developing countries, however, can inoculate their economies with policies that strengthen the domestic economy and facilitate structural change to keep the disease from setting in.

Suggested Citation

  • Beja, Edsel Jr., 2010. "Do international remittances cause Dutch disease?," MPRA Paper 39302, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:39302
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    References listed on IDEAS

    as
    1. Emmanuel K. K. Lartey & Federico S. Mandelman & Pablo A. Acosta, 2012. "Remittances, Exchange Rate Regimes and the Dutch Disease: A Panel Data Analysis," Review of International Economics, Wiley Blackwell, vol. 20(2), pages 377-395, May.
    2. Beja, Edsel Jr., 2009. "Things are different when you open up: Economic openness, domestic economy, and income," MPRA Paper 16552, University Library of Munich, Germany, revised 01 Aug 2009.
    3. Corden, W M, 1984. "Booming Sector and Dutch Disease Economics: Survey and Consolidation," Oxford Economic Papers, Oxford University Press, vol. 36(3), pages 359-380, November.
    4. Puri, Shivani. & Ritzema, Tineke., 1999. "Migrant worker remittances, micro-finance and the informal economy : prospects and issues," ILO Working Papers 993576093402676, International Labour Organization.
    5. Chang-Tai Hsieh & Peter J. Klenow, 2009. "Misallocation and Manufacturing TFP in China and India," The Quarterly Journal of Economics, Oxford University Press, vol. 124(4), pages 1403-1448.
    6. Ralph Chami & Connel Fullenkamp & Samir Jahjah, 2005. "Are Immigrant Remittance Flows a Source of Capital for Development?," IMF Staff Papers, Palgrave Macmillan, vol. 52(1), pages 55-81, April.
    7. Syrquin, M. & Chenery, H.B., 1989. "Patterns Of Development, 1950 To 1983," World Bank - Discussion Papers 41, World Bank.
    8. Amuedo-Dorantes, Catalina & Pozo, Susan, 2004. "Workers' Remittances and the Real Exchange Rate: A Paradox of Gifts," World Development, Elsevier, vol. 32(8), pages 1407-1417, August.
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    10. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-848, December.
    11. Robert M Burgess & V. Haksar, 2005. "Migration and Foreign Remittances in the Philippines," IMF Working Papers 05/111, International Monetary Fund.
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    Citations

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    Cited by:

    1. Farid Farid, 2014. "The impact of exchange rate policy on remittances in Morocco: A Threshold VAR analysis," Economics Bulletin, AccessEcon, vol. 34(4), pages 2351-2360.
    2. Nuno Baetas da Silva & João Sousa Andrade & António Portugal Duarte, 2016. "Alternative Sources of Dutch Disease: A Survey of the Literature," GEMF Working Papers 2016-10, GEMF, Faculty of Economics, University of Coimbra.
    3. Eromenko, Igor, 2016. "Do Remittances Cause Dutch Disease in Resource Poor Countries of Central Asia?," MPRA Paper 74965, University Library of Munich, Germany.
    4. Mahalia Jackman, 2014. "A Note on the Labor Market Effects of Remittances in Latin American and Caribbean Countries: Do Thresholds Exist?," The Developing Economies, Institute of Developing Economies, vol. 52(1), pages 52-67, March.

    More about this item

    Keywords

    Dutch disease; international remittances;

    JEL classification:

    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • F15 - International Economics - - Trade - - - Economic Integration
    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F10 - International Economics - - Trade - - - General
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances

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