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Are Immigrant Remittance Flows a Source of Capital for Development
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TL;DR: In this paper, the authors developed a framework that links the motivation for remittances with their effect on economic activity and showed that remittance has a negative effect on the economic growth.
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Abstract: The role of remittances in development and economic growth is not well understood. This is partly because the literatures on the causes and effects of remittances remain separate. We develop a framework that links the motivation for remittances with their effect on economic activity. Because remittances take place under asymmetric information and economic uncertainty, there exists a significant moral hazard problem. The implication is that remittances have a negative effect on economic growth. We test this prediction using panel methods on a large sample of countries. The results indicate that remittances do have a negative effect on economic growth, which indicates that the moral hazard problem in remittances is severe.
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Citations
Do diaspora remittances affect banking sector development in Sub Saharan Africa
TL;DR: In this article, the effect of diaspora remittances on the banking sector development in Sub-Saharan Africa was investigated using panel regression analysis and pooled regression, fixed effects and random effects.
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Aid and remittances: their stabilizing impact compared
TL;DR: In this article, a comparative analysis of the stabilizing effect of official development assistance (ODA) and migrant remittances is presented, showing that both kinds of flows appear stabilizing.
13
Offsetting the Development Costs? Brain drain and the role of training and remittances
TL;DR: The authors argued that the emigration of highly skilled will automatically represent a loss to the country of origin and called for a more moderate approach to skilled migration and its impact on development, and went beyond the simple brain drain/brain gain dichotomy by looking at the flow of the skilled within specific geographic spaces.
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Emerging market business cycles with remittance fluctuations
C. Bora Durdu,Serdar Sayan +1 more
TL;DR: In this paper, the implications of remittance fluctuations for various macroeconomic variables and Sudden Stops are analyzed. And the authors suggest that procyclical (or countercyclical) remittances can play a significant deepening (or mitigating) role for Sudden Stoops.
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Financial development and the end-use of migrants' remittances
Michael Coon
- 13 May 2014
TL;DR: In this article, the authors examined how the level of financial development in a community affects households' decisions over how remittance income is spent and found that in communities without banks remittances are more likely to be used for productive investments or to purchase assets.
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