IDEAS home Printed from
   My bibliography  Save this paper

Should Moroccan Officials Depend on the Workers’ Remittances to Finance the Current Account Deficit?


  • Bentour, El Mostafa


The Moroccan economy relies heavily on remittances from abroad to the extent they are far more significant sources of income than others such as foreign direct investments and tourism. To assess the reliability of this external financing source by testing the resilience vis-à-vis the hosting countries, we summarize, in this paper, the impact of the business cycles of major hosting European countries on Moroccan workers’ remittances using impulse response functions of a VAR modeling approach. Our findings include, first: the remittances to Morocco and major European countries’ GDP are positively correlated (i.e, are procyclical). Second, the recent global financial crisis and the following downturns in countries, such as Italy and Spain, significantly reduced remittances, while remittances from Germany, Netherlands, Belgium and Luxembourg do not seem to be extremely affected.

Suggested Citation

  • Bentour, El Mostafa, 2013. "Should Moroccan Officials Depend on the Workers’ Remittances to Finance the Current Account Deficit?," MPRA Paper 52290, University Library of Munich, Germany, revised 01 May 2013.
  • Handle: RePEc:pra:mprapa:52290

    Download full text from publisher

    File URL:
    File Function: original version
    Download Restriction: no

    References listed on IDEAS

    1. Richard A. Ashley & Randal J. Verbrugge, 2009. "To difference or not to difference: a Monte Carlo investigation of inference in vector autoregression models," International Journal of Data Analysis Techniques and Strategies, Inderscience Enterprises Ltd, vol. 1(3), pages 242-274.
    2. Adams, Richard Jr. & Page, John, 2005. "Do international migration and remittances reduce poverty in developing countries?," World Development, Elsevier, vol. 33(10), pages 1645-1669, October.
    3. Isabel Ruiz & Carlos Vargas-Silva, 2010. "Another consequence of the economic crisis: a decrease in migrants' remittances," Applied Financial Economics, Taylor & Francis Journals, vol. 20(1-2), pages 171-182.
    4. Razzak Weshah A. & Bentour El M., 2013. "Do Developing Countries Benefit from Foreign Direct Investments? An Analysis of Some Arab and Asian Countries," Review of Middle East Economics and Finance, De Gruyter, vol. 9(3), pages 357-388, December.
    5. John Anyanwu & Andrew E. O. Erhijakpor, 2010. "Do International Remittances Affect Poverty in Africa?," African Development Review, African Development Bank, vol. 22(1), pages 51-91.
    6. Matteo Bugamelli & Francesco Paternò, 2011. "Output Growth Volatility and Remittances," Economica, London School of Economics and Political Science, vol. 78(311), pages 480-500, July.
    7. Weshah Razzak & Elmostafa Bentour, 2012. "Do Developing Countries Benefit from Foreign Direct Investments?," EERI Research Paper Series EERI_RP_2012_07, Economics and Econometrics Research Institute (EERI), Brussels.
    8. Sims, Christopher A, 1980. "Macroeconomics and Reality," Econometrica, Econometric Society, vol. 48(1), pages 1-48, January.
    9. Catalina Amuedo-Dorantes & Susan Pozo, 2011. "Remittances and Income Smoothing," American Economic Review, American Economic Association, vol. 101(3), pages 582-587, May.
    10. Jeffrey Frankel, 2011. "Are Bilateral Remittances Countercyclical?," Open Economies Review, Springer, vol. 22(1), pages 1-16, February.
    11. Serdar Sayan, 2006. "Business Cycles and Workers' Remittances; How Do Migrant Workers Respond to Cyclical Movements of GDP At Home?," IMF Working Papers 06/52, International Monetary Fund.
    12. Ceyhun Bora Durdu & Serdar Sayan, 2010. "Emerging Market Business Cycles with Remittance Fluctuations," IMF Staff Papers, Palgrave Macmillan, vol. 57(2), pages 303-325, June.
    13. Theodore P. Lianos & Anastasia Pseiridis, 2011. "Remittances of Immigrants in Greece," Review of Development Economics, Wiley Blackwell, vol. 15(2), pages 340-355, May.
    14. Robert E.B. Lucas, 2007. "Migration and rural development," The Electronic Journal of Agricultural and Development Economics, Food and Agriculture Organization of the United Nations, vol. 4(1), pages 99-122.
    15. Hoover, Kevin D., 2003. "Some causal lessons from macroeconomics," Journal of Econometrics, Elsevier, vol. 112(1), pages 121-125, January.
    16. Serdar Sayan & B. Onur Tas & Yasemin Yalta, 2010. "Cyclical Behavior of Mexican Remittances over the Mexican and the US Business Cycles," Working Papers 1008, TOBB University of Economics and Technology, Department of Economics.
    17. Duo Qin, 2011. "Rise Of Var Modelling Approach," Journal of Economic Surveys, Wiley Blackwell, vol. 25(1), pages 156-174, February.
    18. Pao-Li Chang & Shinichi Sakata, 2007. "Estimation of impulse response functions using long autoregression," Econometrics Journal, Royal Economic Society, vol. 10(2), pages 453-469, July.
    19. Adolfo Barajas & Ralph Chami & Connel Fullenkamp & Anjali Garg, 2010. "The Global Financial Crisis and Workers' Remittances to Africa: What's the Damage?," Journal of African Development, African Finance and Economic Association, vol. 12(1), pages 73-96.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Remittances; Current Account Balance; Impulse Response Functions;

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:pra:mprapa:52290. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter). General contact details of provider: .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.