Do remittances affect labor market outcomes in Sub-Saharan Africa

Gaston Brice Nkoumou Ngoa ()
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Gaston Brice Nkoumou Ngoa: University of Fribourg, Department of Economics

Economics Bulletin, 2022, vol. 42, issue 2, 303 - 316

Abstract: In this paper, I estimate the effect of remittances on labor market outcomes in sub-Saharan Africa over the period 1975–2019. Using the dynamic system-GMM approach with remittances treated as endogenous, baseline estimates indicate that remittance flows have a significant effect on many labor market outcomes: they increase labor force participation and self-employment rates and significantly decrease unemployment. Robustness checks then show that remittances are associated with workers moving from underemployment to self-employment without increasing labor force participation or wage and salaried work. These findings suggest that to be successful in sub-Saharan Africa, reforms designed to foster productive employment across the labor force should factor in the benefits of remittances.

Keywords: Remittances; Labor market outcomes; Sub-Saharan Africa; GMM (search for similar items in EconPapers)
JEL-codes: J2 O1 (search for similar items in EconPapers)
Date: 2022-06-30
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