Remittances and Growth in Latin America: A Panel Unit Root and Panel Cointegration Analysis

Miguel Ramirez and Hari Sharma ()

Working Papers from Yale University, Department of Economics

Abstract: Using recently developed panel unit root and panel cointegration tests and the Fully-Modified OLS (FMOLS) methodology, this paper estimates the impact of remittances on the economic growth of selected upper and lower income Latin American & Caribbean countries. Despite a large flow of remittances to the region, there have been relatively few empirical studies assessing the impact of remittances on growth in Latin American and the Caribbean. Panel unit root tests suggests that several of the macro variables included in the model exhibit unit roots, yet, at the same time, Pedroni's panel cointegration methodology determined that there is a cointegrating relationship among the variables in the estimated model. Moreover, FMOLS estimates suggest that remittances have a positive and significant effect on economic growth in both groups of countries. The interaction of remittances with a financial development variable revealed that these two variables act as substitutes and, moreover, that the impact of remittances is more pronounced in the presence of the financial development variable.

JEL-codes: C22 (search for similar items in EconPapers)
Date: 2008-06
New Economics Papers: this item is included in nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (48)

Downloads: (external link)
http://economics.yale.edu/sites/default/files/file ... rs/wp000/ddp0051.pdf
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://economics.yale.edu/sites/default/files/files/Working-Papers/wp000/ddp0051.pdf [301 Moved Permanently]--> https://economics.yale.edu/sites/default/files/files/Working-Papers/wp000/ddp0051.pdf)

Related works:
Journal Article: Remittances and Growth in Latin America: A Panel Unit Root and Panel Cointegration Analysis (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecl:yaleco:51

Access Statistics for this paper

More papers in Working Papers from Yale University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by ().