Macroeconomic Impact of Migrant Workers’ Remittances in Bangladesh
DOI:
https://doi.org/10.1956/jge.v15i3.593Keywords:
Remittances, Consumption, Investment, Imports, Economic GrowthAbstract
Bangladesh being over populated is a cheap less-skilled and semi-skilled labor supplier country in the world and earning huge remittances from the abroad. This paper attempts to examine the dynamic effects of remittances on some important macroeconomic variables like consumption, investment, imports and economic growth in both the short and the long run in Bangladesh covering a period (1977-2014) following Nicholas P.Glytsos (2002) of Keynesian-type econometric model. The study finds using two-stage least square (2SLS) technique that one Taka increase in remittances contributes 3.15 Taka in income in Bangladesh through the impact multiplier as well as dynamic multipliers from the first year to seventh year.
References
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Aitymbetov, S. (2006), “Emigrant Remittances: Impact of Economic Development of Kyrgyzstan”, ICEG European Center, Working Paper No. 31.
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Chami, R., Fullenkamp, C., Jahjah, S. (2003) “Are Immigrant Remittance Flows a Source of Capital for Development?” IMF Working Paper 01/189, International Monetary Fund, Washington DC
Chenery, H. B. and Bruno, M. (1962) “Development Alternatives in an Open Economy: The Case of Israel”. Economic Journal, 72: 79-103.
Das, A. (2012), “Remittance Behavior of Migrants and its Macroeconomic Effects in Four Developing Countries”, International Journal of Applied Behavioral Economics, Vol.1, No.1, pp-41-59.
Dilshad, W.B. (2013), “Impact of Workers' Remittances on Economic Growth: An Empirical Study of Pakistan’s Economy”, International Journal of Business and Management, Vol. 8, No.24, pp.126-131.
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Quibra, M.G. (1997) “International Migration, Remittances, and Income Distribution in the Source Country: A Synthesis”, Bulletin of Economic Research, Vol. 49, No. 1.
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Siddique, A., E. A. Selvanathan and S. Selvanathan (2010), “Remittances and Economic Growth: Empirical Evidence from Bangladesh, India and Sri Lanka”, The University of Western Australia, August, Discussion Paper, 10.27.
Singh, T and Dr. A. Mehra (2014), “Remittances and Economic Growth in India: A Time Series Analysis”, Pacific Business Review International, Volume 6, Issue 10.
Stahl, C. and Arnold, F. (1986), “Overseas Workers’ Remittances in Asian Development”. International Migration Review, Vol. 20, No. 4, pp. 899- 925.
Stahl, C.W. and Habib, A. (1989), “The Impact of Overseas Workers’ Remittances on Indigenous Industries: Evidence from Bangladesh”, The Developing Economics, XXVII-3 (September 1989), pp 269-285.
Tansel, A. and Ya?ar, P. (2010), “Macroeconomic Impact of Remittances on Output Growth: Evidence from Turkey”, IZA Discussion Paper No. 5376, December 2010.
Tufail, J.K.S., and S. Amjad (2013), “Impact of Worker Remittances on Economic Growth: Evidence from Pakistan”, Elixir Soc. Sci., 57A (2013), 14383-14386.
Zeisemer, T. (2006) “Worker Remittances and Growth: The Physical and Human Capital Channel”, United nations University, 02.
Ahmed, J., K. Zaman and I. A.Shah (2011), “An Empirical Analysis of Remittances-Growth Nexus in Pakistan Using Bounds Testing Approach”, Journal of Economics and International Finance Vol. 3(3), pp. 176-186.
Ahmed, Md.S. (2010), “Migrant Workers Remittance and Economic Growth: Evidence from Bangladesh”, ASA University Review, Vol. 4 No. 1, January–June, 2010.
Aitymbetov, S. (2006), “Emigrant Remittances: Impact of Economic Development of Kyrgyzstan”, ICEG European Center, Working Paper No. 31.
Blouchoutzi, A. and Nikas, C. (2014), “Emigrants’ remittances and economic growth in small transition economies: The cases of Moldova and Albania”, East-West Journal of Economics and Business, Vol. XVII – 2014, No 2
Chami, R., Fullenkamp, C., Jahjah, S. (2003) “Are Immigrant Remittance Flows a Source of Capital for Development?” IMF Working Paper 01/189, International Monetary Fund, Washington DC
Chenery, H. B. and Bruno, M. (1962) “Development Alternatives in an Open Economy: The Case of Israel”. Economic Journal, 72: 79-103.
Das, A. (2012), “Remittance Behavior of Migrants and its Macroeconomic Effects in Four Developing Countries”, International Journal of Applied Behavioral Economics, Vol.1, No.1, pp-41-59.
Dilshad, W.B. (2013), “Impact of Workers' Remittances on Economic Growth: An Empirical Study of Pakistan’s Economy”, International Journal of Business and Management, Vol. 8, No.24, pp.126-131.
Farid, K.S., L. Mozumdar, M. S. Kabir and K. B. Hossain (2009), “Trends in international migration and remittance flows: Case of Bangladesh”, J. Bangladesh Agril. Univ. 7(2): 387–394.
Glytsos, Nicholas, P. (1998), “Migrant Remittances in the MENA Region: Issues and Policies for Consideration”, Forum, (Newsletter of the Economic Research Forum for the Arab Countries, Iran and Turkey), Vol. 5, No. 1, May.
Glytsos, N.P. (2002), “Dynamic Effects of Migrant Remittances on Growth: An Econometric Model with an Application to Mediterranean Countries”, Centre of Planning and Economic Research, Discussion Paper, No. 74, KEPE, Athens.
Glytos, N.P. (2005), “The Contribution of Remittances to Growth: a Dynamic Approach and Empirical Analysis”, Journal of Economic Studies, Vol.32, Iss.6, pp.468-496.
Green, W. (2003), Econometric Analysis, Fifth Edition, Upper Saddle River NJ: Prentice Hall, 2003
Gujarati, D.N., D.C. Porter and S. Gunasekar (2012), Basic Econometrics,Fifth Edition,Tata McGraw-Hill Companies,Inc.,New York,2012
Koutsoyiannis, A. (2001), Theory of Econometrics, Second Edition, Palgrave Macmillan Limited, 2001
Mahmud, W., (2003), “Bangladesh: Development Outcomes and Challenges in the Context of Globalization”, Conference on the Future of Globalization, October, 10-11, 2003, Yale University.
Masuduzzaman, M. (2014), “Workers’ Remittance Inflow, Financial Development and Economic Growth: A Study on Bangladesh”, International Journal of Economics and Finance; Vol. 6, No. 8 doi:10.5539/ijef.v6n8p247 URL: http://dx.doi.org/10.5539/ijef.v6n8p247.
Muhammad, M. and J. Ahmed (2009), “Dynamic Impact of Remittances on Economic Growth: A Case Study of Pakistan”, Forman Journal of Economic Studies, Vol. 5, 2009 (January December) pp. 59-74
Murshid, K., Iqbal, K., and Ahmed, M. (2002) “A Study on remittance inflows and Utilization”,International Organization for Migration (IOM).
Paul, B.P., Das, A., (2011) “The Remittance-GDP Relationship in the Liberalized Regime of Bangladesh: Cointegration and Innovation Accounting”, Theoretical and Applied Economics, Vol.XVIII (2011), No. 9(562), pp.41-60.
Quibra, M.G. (1986) “Migrant Workers and Remittances: Issues for Asian Developing Countries”, Asian development Review, Vol.4.
Quibra, M.G. (1997) “International Migration, Remittances, and Income Distribution in the Source Country: A Synthesis”, Bulletin of Economic Research, Vol. 49, No. 1.
Rahman, M. (2009), “Contributions of Exports, FDI and Expatriates’ Remittances to Real GDP of Bangladesh, India, Pakistan and Sri Lanka”, Southwestern Economic Review, Vol.36, No.1, pp 141-154.
Raihan, S., Khondker, B.H., Sugiyarto, G. and Jha, S. (2009), “Remittances and Household Welfare: A Case Study of Bangladesh”, ADB Economics Working Paper Series, No. 189, http://hdl.handle.net/11540/1840.
Rapoport, H. and Docquier, F. (2005), “The Economics of Migrants’ Remittances”, IZA DP No. 1531.
Saad, A. (2015), “The Impact of Remittances on Key Macroeconomic Variables: The Case of Palestine”, Palestine Economic Policy Research Institute (MAS), Jerusalem and Ramallah.
Siddique, A., E. A. Selvanathan and S. Selvanathan (2010), “Remittances and Economic Growth: Empirical Evidence from Bangladesh, India and Sri Lanka”, The University of Western Australia, August, Discussion Paper, 10.27.
Singh, T and Dr. A. Mehra (2014), “Remittances and Economic Growth in India: A Time Series Analysis”, Pacific Business Review International, Volume 6, Issue 10.
Stahl, C. and Arnold, F. (1986), “Overseas Workers’ Remittances in Asian Development”. International Migration Review, Vol. 20, No. 4, pp. 899- 925.
Stahl, C.W. and Habib, A. (1989), “The Impact of Overseas Workers’ Remittances on Indigenous Industries: Evidence from Bangladesh”, The Developing Economics, XXVII-3 (September 1989), pp 269-285.
Tansel, A. and Ya?ar, P. (2010), “Macroeconomic Impact of Remittances on Output Growth: Evidence from Turkey”, IZA Discussion Paper No. 5376, December 2010.
Tufail, J.K.S., and S. Amjad (2013), “Impact of Worker Remittances on Economic Growth: Evidence from Pakistan”, Elixir Soc. Sci., 57A (2013), 14383-14386.
Zeisemer, T. (2006) “Worker Remittances and Growth: The Physical and Human Capital Channel”, United nations University, 02.
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Published
07.10.2019
How to Cite
Sarkar, B. (2019) “Macroeconomic Impact of Migrant Workers’ Remittances in Bangladesh”, Journal of Global Economy, 15(3), pp. 167–188. doi: 10.1956/jge.v15i3.593.
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