Impact of Foreign Capital Inflows on Household Savings in Pakistan

Idrees, Muhammad; Khan, Ayesha; Khan, Muhammad Arsalan; Raees, Muhammad Bilal; Syed, Muniza

doi:10.24018/ejbmr.2020.5.4.436

“…Results show a positive effect of remittances on savings among youth that receive remittances (Kokorovi c et al, 2020). Research conducted in Pakistan recommends that if a developing country wants to increase household saving it should give thoughtful importance to remittance inflows Idrees et al (2020).…”

Section: Literature Reviewmentioning

confidence: 90%

Remittances and households’ savings behaviour in Bangladesh

Salahuddin

¹

,

Masud

²

,

Teng

³

2021

SBR

View full text Add to dashboard Cite

Purpose The purpose of this study is to examine the impact of remittance inflow on households’ savings behaviour in Bangladesh. Remittances are considered as the countercyclical flow of income for its recipient economies. It surges the liquidity of the households receiving remittances, allows them to endure local economic shocks and facilitates them to practice productive activities. Remittances often form a big pool of resources for investment which complement the national savings and support the country’s growth through higher rates of capital accumulation. Therefore, if a significant portion of the remittance is used for savings it can lead to prominent economic growth in the long term. Design/methodology/approach Existing literature indicates remittance-receiving households have a greater propensity to use remittance income to meet basic consumption. However, based on the survey conducted by the Bangladesh Bureau of Statistics on remittances and household savings (SIR, 2016) and using the ordinary least square regression analysis method, to identify the connection between remittances and household’s saving (SIR, 2016) and using the ordinary least square regression analysis method, to identify the connection between remittances and household’s savings behaviour in Bangladesh. Findings The findings of this study represent remittances encourage households to pursue different kinds of savings in Bangladesh. Savings are made in the form of opening savings accounts, deposit pension scheme/fixed deposits/Bonds, insurance policies, also savings through non-governmental organizations, cooperative societies and savings at home. Other than remittances the demographic characteristics of the household head also influence the savings choices. Originality/value To enable the implementation of appropriate policies to boost savings, analysis from both perspectives; the household and the national level, requires strong vigilance and surveillance.

show abstract

“…Additionally, savings were not affected by economic fluctuations in the short run but were reliant on demographic determinants as well as foreign capital, which may convey instability in financial flows and economic development of Baltic countries. Idrees et al (2020) investigated the influence of foreign capital flows on domestic savings in Pakistan over the period 1981 to 2010. To analyze the effect of foreign aid, remittances as well as foreign direct investment on household savings authors used the multiple regression analysis.…”

Section: Foreign Capital Inflows and Savings: An Empirical Reviewmentioning

confidence: 99%

Analyzing the Impact of Foreign Capital Inflows on Domestic Savings in Pakistan: A Comprehensive Time Series Investigation

Batool,

Sheikh,

Abbas

et al. 2023

JES

0

View full text Add to dashboard Cite

This research delves into the ramifications of foreign capital inflows on domestic savings within the context of Pakistan. Utilizing annual time series data spanning from 1972 to 2022, this study employs the Auto Regressive Distributed Lag (ARDL) methodology alongside causality analysis. The findings underscore that factors such as labor force participation rate, gross fixed capital formation, deposit interest rate, foreign direct investment, trade, GDP growth, and foreign remittances exert a favorable influence on gross domestic savings over the long term. Conversely, variables encompassing age dependency, external debt stock, and net official development assistance exhibit a detrimental impact on gross domestic savings. Furthermore, the outcomes derived from the Granger causality test reveal the absence of causal relationships between foreign direct investment, remittances, trade, external debt, and gross domestic savings. Notably, unilateral causality is identified solely between net official development assistance and gross domestic savings.

show abstract

“…Additionally, savings were not affected by economic fluctuations in the short run but were reliant on demographic determinants as well as foreign capital, which may convey instability in financial flows and economic development of Baltic countries. Idrees et al (2020) investigated the influence of foreign capital flows on domestic savings in Pakistan over the period 1981 to 2010. To analyze the effect of foreign aid, remittances as well as foreign direct investment on household savings authors used the multiple regression analysis.…”

Section: Foreign Capital Inflows and Savings: An Empirical Reviewmentioning

confidence: 99%

Analyzing the Impact of Foreign Capital Inflows on Domestic Savings in Pakistan: A Comprehensive Time Series Investigation

Batool,

Sheikh,

Abbas

et al. 2023

JES

0

View full text Add to dashboard Cite

This research delves into the ramifications of foreign capital inflows on domestic savings within the context of Pakistan. Utilizing annual time series data spanning from 1972 to 2022, this study employs the Auto Regressive Distributed Lag (ARDL) methodology alongside causality analysis. The findings underscore that factors such as labor force participation rate, gross fixed capital formation, deposit interest rate, foreign direct investment, trade, GDP growth, and foreign remittances exert a favorable influence on gross domestic savings over the long term. Conversely, variables encompassing age dependency, external debt stock, and net official development assistance exhibit a detrimental impact on gross domestic savings. Furthermore, the outcomes derived from the Granger causality test reveal the absence of causal relationships between foreign direct investment, remittances, trade, external debt, and gross domestic savings. Notably, unilateral causality is identified solely between net official development assistance and gross domestic savings.

show abstract

Impact of Foreign Capital Inflows on Household Savings in Pakistan

Cited by 4 publications

References 0 publications

Remittances and households’ savings behaviour in Bangladesh

Remittances and households’ savings behaviour in Bangladesh

Analyzing the Impact of Foreign Capital Inflows on Domestic Savings in Pakistan: A Comprehensive Time Series Investigation

Analyzing the Impact of Foreign Capital Inflows on Domestic Savings in Pakistan: A Comprehensive Time Series Investigation

Contact Info

Product

Resources

About