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Modeling the Impact of Policy Environment on Inflows of Worker’s Remittances in Pakistan: A Multivariate Analysis

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  • Jawad, Muhammad
  • Qayyum, Abdul

Abstract

The study investigates relevant significance of various economic determinants for inflows of worker’s remittances to Pakistan. Following precedence from the policy index developed by Burnside and Dollar (2000), we develop a policy index for Pakistan and use it as a proxy for estimating the relationship of this policy index with the remittances in Pakistan. The study has also taken other conventional macroeconomic determinants into account such as GDP, exchange rate, labor force participation and interest rate spread for having efficient and precise coefficient estimates of our estimated model. The study finds that during the period (1972-2011) policy environment is one of the significant determinants of worker’s remittances in Pakistan. Further, the application of several post estimation tests ascertains that our empirical model is robust.

Suggested Citation

  • Jawad, Muhammad & Qayyum, Abdul, 2015. "Modeling the Impact of Policy Environment on Inflows of Worker’s Remittances in Pakistan: A Multivariate Analysis," MPRA Paper 62019, University Library of Munich, Germany, revised 2015.
  • Handle: RePEc:pra:mprapa:62019
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    More about this item

    Keywords

    Workers’ remittances; Growth; Policy index; Cointegration; Dynamic Error Correction;

    JEL classification:

    • 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
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • J0 - Labor and Demographic Economics - - General

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