The Macroeconomics of Remittances in The Philippines

Veronica Bayangos and Karel Jansen ()

Revista ESPE - Ensayos sobre Política Económica, 2010, vol. 28, issue 61, No 61, 18-58

Abstract: This article first explores the cyclical dynamics of remittances, and then, analyzes the macroeconomic impact of remittances and the monetary policy implications. In this endeavor, we use the case of the Philippines, one of the countries where remittances are substantial. A dynamic structural quarterly macroeconometric model of the Philippines is used to trace the various channels through which remittances affect the main macroeconomic variables.In the assessment of the impact of the 2008 global financial crisis, we should also consider the remittances as a transmission channel. We have established that remittances are driven by the economic cycle of the main host countries and that the ongoing recession will thus lead to a decline in transfers. Through our model, we have been able to trace the impact of changes in remittances on important economic variables such as aggregate demand, money supply and interest rates, the exchange rate, and labor supply and wages.

Keywords: Remittances; Monetary policy; Exchange Rate; Capital flows; Dynamic Structural Model (search for similar items in EconPapers)
JEL-codes: E58 F24 F43 O53 (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://doi.org/10.32468/Espe.6101

Related works:
Journal Article: The Macroeconomics of Remittances in The Philippines (2010)
Working Paper: The Macroeconomics of Remittances In the Philippines (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:bdr:ensayo:v:28:y:2010:i:61:p:18-58

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