Remittance outflows and inflation: The case of the GCC countries

Termos, Ali; Naufal, George; Genç, İsmail H.

doi:10.1016/j.econlet.2013.03.037

Cited by 37 publications

(32 citation statements)

References 13 publications

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“…Narayans et al (2011) show that remittance inflows generate inflation in developing (receiving) countries. Termos et al (2013) show that remittance outflows lower inflation in the GCC countries. Our results for 2004-2014, however, show that remittance outflows do not affect inflation in all but one GCC country.…”

Section: Introductionmentioning

confidence: 90%

The Nexus between Remittance Outflows and GCC Growth and Inflation

Kaabi¹

2016

JIBE

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The literature contains a handful of studies examining the effect of remittance outflows on GCC economies. We reexamine this topic by using panel data for 2004-2014. Specifically, our objective is twofold: First, we examine the nexus between economic growth in the GCC countries and remittance outflows by relaxing the assumption that the effect of remittance outflows on economic growth is the same across the six GCC countries. Research has shown that economic growth declines as remittance outflows increase. Our results show that remittance outflows affect growth in GDP only in the case of Saudi Arabia. For example, when growth in remittance outflows increases by 1 percentage point, then growth in real GDP of Saudi Arabia declines by 0.139 percent. Second, we examine the nexus between inflation and remittance outflows by relaxing the assumption that the effect of remittance outflows on inflation is the same across GCC countries. The literature suggests that inflation declines as remittance outflows increase. Our results for GCC countries show that growth in remittance outflows affect inflation only in the case of Bahrain. For example, when growth in remittance outflows increases by 1 percentage point, then inflation in Bahrain declines by 0.135 percent.

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Section: Introductionmentioning

confidence: 90%

The Nexus between Remittance Outflows and GCC Growth and Inflation

Kaabi¹

2016

JIBE

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“…There are only a few empirical studies on remittance outflows from the GCC countries focusing on the drivers. Other studies analyze potential macroeconomic effects on the GCC countries, like lowering inflation (Termos, Naufal, & Genc, 2013) or short-term growth (Alkhathlan 2013).…”

Section: Stylized Facts and Literature Review On Remittance Outflowmentioning

confidence: 99%

Oil prices, growth, and remittance outflows from the Gulf Cooperation Council

Quayyum

Schuettler

et al. 2019

Economic Notes

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How does a decline in oil prices and its impacts on growth affect remittance outflows from the Gulf Cooperation Council (GCC) countries? This paper carries out an empirical analysis of the relationship between oil prices, oil‐ and non‐oil GDP, and remittances outflows from the GCC. The findings of our paper are three folds. First, we find that non‐oil GDP is a key determinant of remittance outflows and that oil GDP is a significant driver of non‐oil GDP in the GCC only in the long term. Second, we document that historically oil prices and remittances tend to broadly move in the same direction but that remittances have been much less volatile than oil prices. An analysis of the past large oil price declines shows that remittance flows to major remittance recipients in Mashreq, Pakistan, and Yemen fell only modestly following large declines in oil prices and recovered quickly in line with oil prices. Finally, we estimate the elasticity of remittance outflows with respect to non‐oil GDP in the GCC using various techniques. Estimates of short‐term elasticity vary between 0.5 and 0.8, while estimates of long‐term elasticity vary between 0.6 and 1.1. We find that construction and government services are two non‐oil GDP components that are strongly associated with remittance outflows.

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“…This result occurred due to higher oil prices increase costs of distribution for goods and services. Bashir et al (2011) for Pakistan and Termos et al (2013) for GCC countries have the same conclusion. The final hypothesis is: description information is shown in Table1 below (for variables).…”

Section: H8: There Is a Significant Correlation Between Arab Spring Amentioning

confidence: 64%

“…The same result of Franses and Janssens (2018), corruption reduced the prices levels significantly. Termos et al (2013) focused on the GCC countries and found the drivers of inflation rates through the period 1972-2010. The statistical methods in this study are ordinary least square (OLS), fixed-effects model and anderson-hsiao (AH) regression.…”

Section: Literature Reviewmentioning

confidence: 99%

What Drives Inflation in Gulf Cooperation Council (GCC) Countries

Alharthi

2019

BER

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The main reason of this study is to determine the main inflation determinants in Gulf Cooperation Council (GCC) countries over the period 1996-2016. The GCC area is exposing many economic challenges and risks like higher prices of basic products and services. Moreover, GCC countries impose value added tax in 2018 that increased the prices significantly. To reduce the prices rates, GCC governments decided to support the local manufacturing rather than depending on imports. However, controlling the inflation rates is showing the efficiency of economic administration for any country. In this study, the data was gathered through the United Nations Conference on Trade and Development (UNCTAD) International Monetary Fund (IMF) and World Bank (WB) databases. Statistically, the data were analysed by generalized method of moments (GMM) and generalized least square (GLS). The main results of this study show that the foreign direct investment (FDI) is one of main determinants that has an inverse and significant influence on inflation. Moreover, the corruption impacted the inflation positively and significantly. Finally, the oil prices are controlling the inflation as higher oil prices increase the inflation rates significantly.

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Remittance outflows and inflation: The case of the GCC countries

Cited by 37 publications

References 13 publications

The Nexus between Remittance Outflows and GCC Growth and Inflation

The Nexus between Remittance Outflows and GCC Growth and Inflation

Oil prices, growth, and remittance outflows from the Gulf Cooperation Council

What Drives Inflation in Gulf Cooperation Council (GCC) Countries

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