Remittances and Economic Growth: Empirical Evidence from Bangladesh, India and Sri Lanka

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Title Remittances and Economic Growth: Empirical Evidence from Bangladesh, India and Sri Lanka
Author Siddique, Abu; Selvanathan, Selva; Selvanathan, Saroja
Journal Name Journal of Development Studies
Year Published 2012
Place of publication United Kingdom
Publisher Routledge
Abstract In many developing countries, remittance payments from migrant workers are increasingly becoming a significant source of export income. This article investigates the causal link between remittances and economic growth in three countries, Bangladesh, India and Sri Lanka, by employing the Granger causality test under a Vector Autoregression (VAR) framework (Granger, C.W.J. (1988) Some recent developments in the concept of causality. Journal of Econometrics, 39, pp. 199–211). Using time series data over a 25-year period, we found that growth in remittances does lead to economic growth in Bangladesh. In India, there seems to be no causal relationship between growth in remittances and economic growth; but in Sri Lanka, a two-way directional causality is found; namely economic growth influences growth in remittances and vice-versa. The article also discusses a number of policy issues arising from the causality results.
Peer Reviewed Yes
Published Yes
Alternative URI http://dx.doi.org/10.1080/00220388.2012.663904
Volume 48
Issue Number 8
Page from 1045
Page to 1062
ISSN 0022-0388
Date Accessioned 2012-07-11
Language en_US
Faculty Griffith Business School
Subject Economic Development and Growth
URI http://hdl.handle.net/10072/47315
Publication Type Journal Articles (Refereed Article)
Publication Type Code c1

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