Interactive Impacts of Remittance Inflows on Economic Growth in Algeria: Is the N-shaped Hypothesis Valid?

Hicham Ayad, Amina Bendahmane and Mohamed Driouche Dahmani

Politická ekonomie, 2025, vol. 2025, issue 4, 584-614

Abstract: This investigation explores the influence of remittances on economic growth in Algeria during the period 1970-2022 using the Fourier autoregressive distributed lags (FARDL) model. This study provides new insights by suggesting an N-shaped association between remittances and economic growth. The findings reveal a nonlinear relationship between remittances and growth in Algeria. Initially, the impact of remittances on income is positive, then becomes negative when they exceed a threshold of 1.2% of GDP, and later becomes positive again when remittances surpass a second threshold estimated at 1.894% of GDP. These results highlight the importance of increasing remittance inflows to promote development in Algeria and urge decision-makers to create conditions that encourage the inflow of these funds through official channels

Keywords: Remittances; economic growth; N-shape association; Algeria; FARDL model (search for similar items in EconPapers)
JEL-codes: C22 F22 F24 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.18267/j.polek.1464

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