Growth and Employment Empirics of Bangladesh

Matiur, Ph. D. Rahman; Mustafa, Muhammad; Islam, Anisul M.; Guru-Gharana, Kishor K.

doi:10.1353/jda.2007.0008

Cited by 20 publications

(12 citation statements)

References 62 publications

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“…Inflow of earnings of overseas employees to their home country has significant positive direct impact on reducing the level of poverty. Rahman, Mustafa, Islam, and Gharana (2006) founded that real per capita GDP growth has long run contributory relation with per capita employment. Foreign direct investment growth, migrants' remittances growth, and export growth also augment to employment opportunities.…”

Section: The Literature Reviewmentioning

confidence: 99%

Nexus between workers’ remittances, unemployment, labor migration and economic growth in Pakistan

Asad¹,

Hashmi²,

Yousaf³

2016

IJOL

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This study examines the relationship between workers' remittances and economic growth along with labor migration in Pakistan. The study also investigates the relationship between workers' remittances and unemployment and captures the interaction between unemployment and economic growth. Annual time series data from 1975 to 2010 is used for analysis. Following this, Johansen and Juselius' (1990) co-integration technique and recursive simultaneous equations model have been applied for analysis. Multivariate and Bivariate Co-integration approach shows that there exists long-term relationship between workers' remittances and economic growth in Pakistan. Bivariate co-integration presents that economic growth has long-run relationship with labor migration and unemployment. There is long-run relationship between workers' remittances and unemployment and human capital has long run association with workers' remittances. Granger Causality test shows that there exist unidirectional causality between workers' remittances and economic growth. Unidirectional causality runs from labor migration and unemployment to economic growth. Similarly, unidirectional causality runs from workers' remittances to unemployment level in country. The recursive OLS results manifested that workers' remittances have significant positive impact on consumption and consumption in turn has significant positive effect on economic growth.

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Section: The Literature Reviewmentioning

confidence: 99%

Nexus between workers’ remittances, unemployment, labor migration and economic growth in Pakistan

Asad¹,

Hashmi²,

Yousaf³

2016

IJOL

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“…Such policy questions include the opportunity cost attributable to the emigration of skilled workers, the financial treatment of recipients of remittances, the composition of domestic institutions for the transmission of remittances and the style and placement of investment incentives targeting remittance recipients. Furthermore, most of the other studies have qualitatively considered the impact of remittances on an economy in terms of social measures such as education, health and democratisation (for example, see Rahman et al, 2006), and development budget increases. Nor has any quantitative analysis on the causality between remittances and economic growth been conducted.…”

Section: Motivation For the Current Studymentioning

confidence: 99%

“…Those that believe remittances do not contribute to economic growth point to their expenditure on conspicuous consumption (Rahman et al, 2006) and that any savings are being spent on consumption rather than for the accumulation of productive assets (Stahl and Arnold, 1986), and the theoretically low marginal propensity to consume out of transitory income. Those that argue for the positive developmental effects of remittances focus Remittances and Economic Growth 1047 on the multiplier effects of consumption (Stahl and Arnold, 1986), development of the financial institutions that handle remittance payments (Aggarwal et al, 2006), use of remittances as foreign exchange (Ratha, 2005), and the role of remittances as an alternative to debt that helps alleviate individuals' credit constraints in countries where micro-financing is not widely available (Guilamo and Ruiz-Arranz, 2009).…”

Section: Introductionmentioning

confidence: 99%

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

Siddique

Selvanathan

2012

Journal of Development Studies

145

106

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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,. 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.

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“…Ali (1981) identifies that remittances help for favorable balance of payment. On the other hand, Rahman et al (2006) and Rahman (2009) concludes that remittance seems to have insignificant and ambiguous effects on Bangladesh's GDP. Ahmed (2010) finds that flow of remittances to Bangladesh have been statistically significant but have a negative impact on growth.…”

Section: Literature Reviewmentioning

confidence: 99%

Relationship between Remittance and Economic Growth in Bangladesh: an Autoregressive Distributed Lag Model (ARDL)

2016

European Researcher

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This study examines the long-run impact of remittances on economic growth in Bangladesh. Bangladesh, being one of the top remittance-recipient countries in the world, has drawn attention to the remittance-output relationship in recent years. In 2014, remittances contributed to 8.2% of GDP of Bangladesh while the contribution was 6.7% in 2006. The main objective of this study is to investigate the impact of the remittance on economic growth (GDP). We adopted Autoregressive Distributed Lag (ARDL) models or dynamic linear regressions are widely used to examine the relationship between remittances and economic growth in the country. In testing for the unit root properties of the time series data, all variables are found stationary at first differencing level under the ADF and PP stationary tests. The study made use of diagnostic tests such as the residual normality test, heteroskedacity and serial autocorrelation tests for misspecification in order to validate the parameter estimation outcomes achieved by the estimated model. The stability test of the model is also checked by CUSUM test. The ARDL model presents that there exist a statistically significant long run positive relationship between remittance and economic growth of gross domestic product in Bangladesh.

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Growth and Employment Empirics of Bangladesh

Cited by 20 publications

References 62 publications

Nexus between workers’ remittances, unemployment, labor migration and economic growth in Pakistan

Nexus between workers’ remittances, unemployment, labor migration and economic growth in Pakistan

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

Relationship between Remittance and Economic Growth in Bangladesh: an Autoregressive Distributed Lag Model (ARDL)

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