 Migrant Remittance Inflow and Industrialization in Africa: What Role Does Financial Development Play?B. W. Adeoye (),
Chinenye Ifeoma Nwokolo () and
Nnenna Ifunanyachukwu Igboanugo ()
A chapter in Financing Africa’s Development, 2020, pp 191-220 from Springer Abstract: Abstract The eruption of Global Financial Crises at the rear end of 2008 with its aftermath effect has shifted the focal point of financial-cum-capital reliance of most developing countries away from sources of finance induced externally. This, however, kick-started research interest toward considering other ways of sourcing financial resources for development apart from the widely known sources like foreign portfolio investment (FPI), foreign direct investment (FDI) and official development assistance from overseas. This notwithstanding, migrants’ remittances imperatively remain a better source of finance as it is found to be more resilient, in times of macroeconomic shocks and other natural disturbances compared to other sources of capital flows. This uniqueness has made it a point of focus to African Development practitioners as a more reliable source for financing development in Africa. Thus, for any developing country to have a sustainable development it must transit from agricultural produce to industrialization as it is seen as the bedrock of development. This ignited our motivation for this study to assess how migrant remittances can directly and/or indirectly influence industrialization using a panel data of 46 African countries from 1980 to 2017. The direct effect is evaluated through financial development channels. The study used both interactive and non interactive empirical evidence methods for a more robust estimation; this includes (a) Fixed Effects techniques (FE) to rule out heterogeneity; (b) General Method of Moments (GMM) to rule out persistence in industrialization and (c) Instrumental Quantile Regressions (QR) to explain for the previous levels of industrialization. The non interactive stipulations will give account for the direct impact of migrant remittances on industrialization while the interactive stipulations will account for the indirect effect. The findings clearly show that personal remittance inflows can only drive industrialization through financial development at the early stage. Keywords: Migrant remittances; Africa; Industrialization; Financial development (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:aaechp:978-3-030-46482-0_11 Ordering information: This item can be ordered from DOI: 10.1007/978-3-030-46482-0_11 Access Statistics for this chapter More chapters in Advances in African Economic, Social and Political Development from Springer |
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