With reference to India.
|Series||Working paper series -- 407|
|Contributions||Centre for Development Studies (Trivandrum, India)|
|LC Classifications||Microfiche 2009# (H)|
|The Physical Object|
|Number of Pages||53|
|LC Control Number||2009311931|
Shera and Meyer () have examined the impact of remittance to macroeconomic aspects in 21 developing countries. The study found that remittances are positively affecting economic growth. However Chami et al () find that remittances have negative impacts on economic growth of recipient country because a significant flow of remittances reduce labor force participation and work efforts which lowers output. Thus, the impact of remittances on economic growth and development of recipient country has been by: policy, especially if remittances are found not to have a positive impact (or any impact) on economic growth. In this case, policymakers could focus their efforts on two areas: finding ways to channel remittances into uses that do enhance economic growth, and promoting other activities that facilitate economic g: book. Finally, micro-level studies show that remittances can lock in existing household inequalities. Since development includes not only economic growth, but also includes equitable human welfare and poverty reduction, the impact of remittances on development are complex and may be adverse.
Remittance is one of the most important external sources flowing into developing countries. Many studies have examined the impact of remittances on macroeconomic issues. However, there is a . The impact on output is dependent on the behavior of capital and labor. The remittances shock increases the purchasing power of the recipient, a wealth effect, that gives rise to a slight decline in labor. Since the capital stock is fixed for a period, this reduction in labor causes a small decline in output on by: Remittances are a new financial phenomena and one of the main important sources of incomes based on it seize and economic impact in the world. Data from (World Bank, ) indicates that global remittance is $ billion dollar in and remittance is % of global GDP in Cited by: Migration and remittances are generally part of risk-spreading and co-insurance livelihood strategies pursued by households and families. Migration and remittances also have the potentialto improve well-being, stimulate economic growth and reduce poverty directly and indirectly, while their effects on inequality are much more by:
Using a panel of countries over almost three decades, Chami et al. () find that remittances are negatively associated with economic growth. This result is consistent with their model in which remittances weaken recipients’ incentives to work and, therefore, lead to poor economic performance. macro-level impact. Previous research analyses the impact of remittances on the economic growth in major remittance recipients, such as India, China, the Philippines, Mexico, Nigeria, Egypt, Pakistan, Bangladesh, Vietnam, and the Ukraine. Most of the studies have generally found that remittances had a positive impact on economic by: 8. However, remittances may not be sent to the very poorest in developing economies meaning that remittances still leave a gap, which may need to be funded by aid. One substantial drawback of remittances is that it means developing economies lose their best, most skilled young workers. between remittances and growth has not received more systematic attention. Most of the work done on the macroeconomics of remittances and their impact on growth is qualitative. As emphasized by Rapoport and Docquier (), one constraint in analyzing the impact of remittances on growth has been the lack of comprehensive cross-country evidence.