Workers’ remittances and economic growth in China and Korea: an empirical analysis

Syed Tehseen Jawaid and Syed Raza

MPRA Paper from University Library of Munich, Germany

Abstract: This study investigates the relationship between workers’ remittances and economic growth in China and Korea by employing time series data from period of 1980 to 2009. Cointegration results confirm that there exist significant positive long run relationship between remittances and economic growth in Korea, while, significant negative relationship exist between remittances and economic growth in China. Error correction model confirms the significant positive short run relationship of workers’ remittances with economic growth in Korea while, the results of China were insignificant in short run. Causality analysis confirms unidirectional causality runs from workers’ remittances to economic growth in both China and Korea. Sensitivity analysis confirms that the results are robust. It is suggested that Korea should form friendly policy to ensure the continuous inflows of workers’ remittances and their efficient utilization to ensure economic growth. On the other hand, China should keep an eye to reduce voluntary unemployment leads to decrease in productivity and growth in the country.

Keywords: Remittances; Open Economy; Economic Growth (search for similar items in EconPapers)
JEL-codes: F24 F41 F43 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-fdg, nep-mig and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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Journal Article: Workers' remittances and economic growth in China and Korea: an empirical analysis (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:39003

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