Remittance and economic development: Evidence from Bangladesh using unrestricted error correction model and Engle-Granger cointegration approach

• Authors: Shimul Shafiun N
• Languages of publication: EN

Abstracts

EN

Remittance is one of the popular issues in the development economics. This paper attempted at finding the relationship between remittance flow and economic development using time series data of 1976-2007. The two modern time series econometric approaches- bound testing Autoregressive Distributed Lag Models or Unrestricted Error Correction Model (UECM) and Engel Granger two step procedure for co-integration test- were executed and this study found that remittance was not significantly affecting the GDP per capita both in the short and long run although the foreign direct investment was found significant in the short but not in the long run. The study suggested adopting appropriate steps so that these can be used as a contributor to the economic development.

Keywords

EN

Remittance, economic development, Bangladesh, cointegration

• Publisher: Prague Development Center, Czech Republic
• Journal: Business and Economic Horizons
• Year: 2013
• Volume: 9
• Issue: 1
• Pages: 15-21

Dates

published

2013-04-01

Contributors

author

Shimul Shafiun N

References

• Ang, A., 2007. “Workers’ remittance and economic growth in the Philippines,” Retrieved 20.03.2013, http://www.degit.ifw-kiel.de/papers/degit_12/C012_029.pdf
• Engel, R., Granger, C., 1987. “Co-integration and error-correction: Representation, estimation and testing,” Econometrica, Vol.55(2), pp.251-76
• Glytsos, N., 2005. “Dynamic effects of migrant remittances on economic growth: An econometric model with an application to Mediterranean Countries,” Discussion Paper, No.74
• IMF, 2005. World economic outlook: Globalization and external imbalances, Washington DC
• Johansen, S., Juselius, K., 1990. “Maximum likelyhood estimation and inference on the cointegration with applications to the demand for money,” Oxford Bulletin of Economics and Statistics, Vol.52, pp.169-210
• Karagoz, K., 2009. “Workers' remittances and economic growth: Evidence from Turkey,” Journal of Yasar University, Vol.4(13), pp.1891-908
• Pesaran, M., Shin, Y., Smith, R., 1997. “Bounds testing aprroaches to the analysis of level relationships,” DEA working paper 9622, Department of Applied Economics, University of Cambridge
• Pesaran, M., Shin, Y., Smith, R., 2001. “Bounds testing approahces to the analysis of level relationships,” Journal of Applied Econometrics, Vol.16, pp.289-326
• Pradhan, G., Upadhay, M., Upadhaya, K., 2008. “Remittance and economic growth in developing countries,” The European Journal of Development Research, Vol.20, pp.497-506
• Mundaca, G., 2009. “Remittances, financial markets development and economic growth: The case of Latin America and Caribbean,” Review of Development Economics, Vol.13(2), pp.288-303
• Woodward Kaupert, Ch., 2007. “Migrant bearing economic gifts: Measuring remittance use in the developing countries,” Paper presented at the annual meeting of the American Sociological Association, TBA, New York City
• World Bank, 2008. World develoment indicators 2008, Washington DC
• World Bank, 2011. Migration and Remittances Factbook 2011, Washington DC

Identifiers

DOI

10.15208/beh.2013.2

URI

http://academicpublishingplatforms.com/article.php?journal=BEH&number=9&article=1714