The role of migrant workers remittances in fostering economic growth

Muhammad Azam (School of Economics, Finance & Banking, College of Business, Universiti Utara Malaysia, Sintok, Malaysia)

International Journal of Social Economics

ISSN: 0306-8293

Publication date: 10 August 2015

Abstract

Purpose

The purpose of this paper is to examine the macroeconomic impact of migrant workers’ remittances on economic growth in four developing Asian countries namely: Bangladesh, India, Pakistan and Sri Lanka.

Design/methodology/approach

This study utilizes annual time series data over the period 1976-2012 and the ordinary least squares as an analytical technique for parameters estimation.

Findings

Empirical results support the existence of a significant positive relationship between migrant workers remittances and economic growth. The other control variables such as foreign direct investment, openness to trade and infrastructure are also found to be statistically significant with expected signs.

Practical implications

The findings of this study are expected to guide policy makers in formulating the right and relevant policies through which migrant workers’ remittances can be made more productive and its benefits for both migrants and the country of origin are maximized. Consequently, it will foster economic growth and development.

Originality/value

This paper provides some valuable evidences on the significance of migrant workers remittances as a source of economic growth. Moreover, the study differs from the erstwhile studies in terms of control variables, time period and method of estimation. Finally, the empirical results established are relatively robust.

Keywords

Citation

Azam, M. (2015), "The role of migrant workers remittances in fostering economic growth", International Journal of Social Economics, Vol. 42 No. 8, pp. 690-705. https://doi.org/10.1108/IJSE-11-2013-0255

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited

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