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Remittances and Business Cycles: Comparison of South Asian Countries

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  • Mazhar Yasin MUGHAL
  • Junaid AHMED

Abstract

South Asia is one of the world?s principal remittance-receiving regions. This study examines the home and host business cycles of migrant remittances to the region. Employing Structural VAR, the remittance behaviour of the region?s four main countries is compared. Remittances to India and Pakistan show a mainly acyclical behaviour with respect to the output of the four host regions, and a countercyclical one with the home output. In contrast, remittances to the two smaller economies of Bangladesh and Sri Lanka are found to be mainly procyclical. The study shows that remittance behaviour varies with respect to the importance of remittance flows in the home economy. Moreover, remittance behaviour seems to respond more to home economy specificities than to those of the different regions hosting the migrants from the developing country.

Suggested Citation

  • Mazhar Yasin MUGHAL & Junaid AHMED, 2013. "Remittances and Business Cycles: Comparison of South Asian Countries," Working Papers 2012-2013_4, CATT - UPPA - Université de Pau et des Pays de l'Adour, revised Jan 2013.
  • Handle: RePEc:tac:wpaper:2012-2013_4
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    Cited by:

    1. Farid MAKHLOUF & Adil NAAMANE, 2013. "The Impact of Remittances on Economic Growth: The Evidence from Morocco," Working Papers 2013-2014_3, CATT - UPPA - Université de Pau et des Pays de l'Adour, revised Sep 2013.
    2. Ahmed, Junaid & Martinez-Zarzoso, Inmaculada, 2014. "What drives bilateral remittances to Pakistan? A gravity model approach," Center for European, Governance and Economic Development Research Discussion Papers 209, University of Goettingen, Department of Economics.
    3. Ahmed, Junaid & Martinez-Zarzoso, Inmaculada, 2013. "Blessing or curse: The stabilizing role of remittances, foreign aid and FDI to Pakistan," Center for European, Governance and Economic Development Research Discussion Papers 153, University of Goettingen, Department of Economics.
    4. Mazhar Yasin Mughal & Amar Iqbal Anwar, 2015. "Do migrant remittances react to bouts of terrorism?," Defence and Peace Economics, Taylor & Francis Journals, vol. 26(6), pages 567-582, December.
    5. Ahmed, Junaid & Martínez-Zarzoso, Inmaculada, 2015. "Do transfer costs matter for foreign remittances? A gravity model approach," Economics Discussion Papers 2015-12, Kiel Institute for the World Economy (IfW).

    More about this item

    Keywords

    Remittances; Business cycles; South-Asia; Bangladesh; India; Pakistan; Sri Lanka; SVAR;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F15 - International Economics - - Trade - - - Economic Integration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances

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