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Exploring the nexus between remittances and economic growth: a study of Bangladesh

Kumar, Ronald R. and Stauvermann, P.J. (2014) Exploring the nexus between remittances and economic growth: a study of Bangladesh. International Review of Economics, 61 (4). pp. 399-415. ISSN 1865-1704

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Abstract

In this article, we explore the much debated nexus between remittances and economic growth in Bangladesh. Drawing on an annual data from 1979 to 2012 and using the augmented Solow framework with the autoregressive distributed lag bounds procedure, we examine the cointegration relationship, the short-run and long-run effects and the causality nexus between remittances per worker, capital per worker and the output per worker. The results show that remittances have a mixed effect in the short-run, however, a momentous positive effect in the long-run (0.11 %), on the output per worker. From the Granger causality assessment, we find inter alia, a bidirectional causality between remittances and output (in per worker terms) and a unidirectional causation from capital to remittances (in per worker terms). Our results therefore support remittance led growth hypothesis in Bangladesh.

Item Type: Journal Article
Subjects: H Social Sciences > HA Statistics
H Social Sciences > HB Economic Theory
Divisions: Faculty of Business and Economics (FBE) > School of Accounting and Finance
Depositing User: Ronald Kumar
Date Deposited: 25 Nov 2014 16:23
Last Modified: 21 Sep 2016 16:23
URI: http://repository.usp.ac.fj/id/eprint/7829
UNSPECIFIED

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