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Pakistan: Migration, Remittances, and Development


  • Siddiqui, Rizwana


The study investigates micro and macro effects of international migration and foreign remittances using (1) comparative static CGE model, (2) dynamic CGE model, (3) Econometric estimation. It uses data from two Social Accounting Matrices for the years 1990 and 2002 to operationalise CGE models and time series data for econometric estimation. The results of the study suggest that migration has upward pressure on wages. This leads to increase in consumption that have welfare improving and poverty reducing impact on both rural and urban households. However, it benefits more to urban households. Consequently, despite increase in standard of living, the gap between urban and rural households increases in both years –1990 and 2002. The remittances inflow in 2002 have strong positive effect than that in 1990 on macro aggregates. But poverty effects are higher in 1990. Analysis in dynamic CGE framework suggests that outflow of labour and inflow of remittances has not stimulated growth process. Econometric estimation reveals that the impact of remittances on poverty depends on the region from where remittances originates—Middle east or developed countries. Remittances from middle east have poverty reducing impact, but remittances from developed countries have no impact on poverty.

Suggested Citation

  • Siddiqui, Rizwana, 2009. "Pakistan: Migration, Remittances, and Development," MPRA Paper 90152, University Library of Munich, Germany, revised 2010.
  • Handle: RePEc:pra:mprapa:90152

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    References listed on IDEAS

    1. Rizwana Siddiqui & Zafar Iqbal, 1999. "Social Accounting Matrix of Pakistan for 1989-90," PIDE-Working Papers 1999:171, Pakistan Institute of Development Economics.
    2. Rizwana Siddiqui, 2009. "Modeling Gender Effects of Pakistan's Trade Liberalization," Feminist Economics, Taylor & Francis Journals, vol. 15(3), pages 287-321.
    3. Rizwana Siddiqui, 2007. "Dynamic Effects of Agriculture Trade in the Context of Domestic and Global Liberalisation : A CGE Analysis for Pakistan," Trade Working Papers 22220, East Asian Bureau of Economic Research.
    4. Ijaz Gilani & M. Fahim Khan & Munawar Iqbal, 1981. "Labour Migration from Pakistan to the Middle East and its Impact on the Domestic Economy. Part III (Sample Design & Field-Work)," PIDE-Working Papers 1981:128, Pakistan Institute of Development Economics.
    5. Dorosh, Paul & Niazi, Muhammad Khan, 2006. "Social Accounting Matrix for Pakistan, 2001-02: Methodology and Results," MPRA Paper 2242, University Library of Munich, Germany.
    6. Zafar Iqbal & Abdus Sattar, 2005. "The Contribution of Workers’Remittances to Economic Growth in Pakistan," PIDE-Working Papers 2005:187, Pakistan Institute of Development Economics.
    7. Ijaz Gilani & M. Fahim Khan & Munawar Iqbal, 1981. "Labour Migration from Pakistan to the Middle East and Its Impact on the Domestic Economy Part I (Cost-Benefit Analysis)," PIDE-Working Papers 1981:126, Pakistan Institute of Development Economics.
    8. G. M. Arif, 1999. "Remittances and Investments at the Household Level in Pakistan," PIDE-Working Papers 1999:166, Pakistan Institute of Development Economics.
    9. Mohammad Irfan, 1986. "Migration and Development in Pakistan. Some Selected Issues," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 25(4), pages 743-755.
    10. Sohail J. Malik & Naeem Sarwar, 1993. "Some Tests for Differences in Consumption Patterns: The Impact of Remittances Using Household Income and Expenditure Survey Data of Pakistan 1987-88," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(4), pages 699-711.
    11. Decaluwe, B. & Patry, A. & Savard, L. & Thorbecke, E., 1999. "Poverty Analysis Within a General Equilibrium Framework," Cahiers de recherche 9909, Université Laval - Département d'économique.
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    More about this item


    Pakistan; Migration; Remittances; Development;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty


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