Do immigrants’ funds affect the exchange rate?
Arusha Cooray and
Wing Leong Teo ()
CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University
Using annual data over 1966-2014 from the Citizenship and Immigration statistics archives of Canada, we investigate how the funds brought into Canada by immigrants, affects the real effective exchange rate (REER) of Canada. We employ the ARDL bounds testing (Pesaran, Shin and Smith, 1999) and Dynamic OLS (Stock and Watson, 1993) approaches to cointegration. Both estimation methods indicate a long run relation between immigrants’ funds and exchange rate with immigrants’ funds leading to a significant appreciation of the exchange rate in Canada. These results are robust to different estimation methods and an alternative proxy measure for the funds brought into Canada by immigrants.
Keywords: Immigration; immigrants’ money; exchange rate; Canada (search for similar items in EconPapers)
JEL-codes: F31 F41 (search for similar items in EconPapers)
Pages: 32 pages
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Journal Article: Do immigrants’ funds affect the exchange rate? (2021)
Working Paper: Do immigrants’ funds affect the exchange rate? (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2017-64
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