Impact of Remittances on Economic Growth: Bangladesh Perspective

Alam, Md Mahbubul (2014). Impact of Remittances on Economic Growth: Bangladesh Perspective Master's Thesis, School of Economics, The University of Queensland.

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Author Alam, Md Mahbubul
Thesis Title Impact of Remittances on Economic Growth: Bangladesh Perspective
School, Centre or Institute School of Economics
Institution The University of Queensland
Publication date 2014-11-11
Thesis type Master's Thesis
Supervisor Sinchan Mitra
Total pages 80
Language eng
Subjects 14 Economics
Formatted abstract
This study investigates the impact of remittances on economic growth of Bangladesh. Bangladesh is one of the leading remittances earning countries in the world. A major part of the total GDP is contributed by the migrants’ remittances in Bangladesh. So, it is very important to identify how remittances are influencing the country’s overall economic growth. Though a number of studies have been conducted to in this regard, country specific studies are not very common for Bangladesh. Moreover, most of the studies are not up to date and the outcomes are not very. To fill up these gaps this study analysed the impact of remittances on the economic growth of Bangladesh with the most recent annual time series data from 1976 to 2013. This study employed real capita GDP as the dependent variable and remittances, current account openness, capital account openness, capital formation, inflation and exchange rate as the independent variables. Augmented Dickey Fuller and Phillip Perron unit root tests were deployed to investigate the stationary properties of the data. To identify the long run and short run association between remittances and growth Johansen cointegration test along with vector error correction model were used. Granger Causality test was also conducted to explore the direction of causality. The study results revealed that remittances have significant long run positive impact on economic growth of Bangladesh. However, in the short run, the impact is not statistically significant. The causality test identified one way causality from GDP to remittances. Based on the results the study concluded that remittances flows are very important for Bangladesh economic growth and measures need to be taken to uphold the continuous inflows of remittances.
Keyword Remittances
Economic Growth
Economic Development

Document type: Thesis
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