Narrow Results

Remittance inflows are now the largest source of external financing to developing countries, but little research has yet firmly established the effect of remittances on household welfare. We investigate the case of Tajikistan, one of the most heavily remittance-dependent countries in the world. We use a panel dataset collected nationwide and employ an instrumental variable estimation to confirm a positive relationship between receiving remittances and household welfare after correcting for endogeneity. Moreover, we find that the effect of remittances on household spending is more pronounced in households whose head is male, older, and/or less educated. Then, we combine our estimated coefficients with the projected decline of remittance inflows as a result of the coronavirus disease (COVID-19) outbreak and show the pandemic’s adverse effect on household spending per capita.

This paper examines the cyclicality of remittance inflows to economies in Asia and the Pacific, aiming to identify major factors associated with remittances using gravity models of bilateral remittances. An analysis that assesses correlation coefficients between the cyclical factors of remittances and gross domestic product suggests that remittances tend to be countercyclical, or acyclical, against the business cycle of the remittance-receiving economy relative to the sending economy. This observation is confirmed by the gravity models of bilateral remittances. Furthermore, the estimation results suggest that migrant stock is one of the most significant factors affecting bilateral remittances. The study also shows that an increase in bilateral remittances can be attributed to a higher occurrence of disasters triggered by natural hazards in receiving economies, an appreciation of the receiving economy’s currency value against the sending economy’s, a lower interest rate differential (receiver–sender), greater capital account openness, more political instability, and lower costs of remittances.

Nigeria has become one of the sub-Saharan Africa’s largest remittance recipients. Despite the economic benefits of remittances, there is rising concern about their impact on environmental degradation. The NARDL approach was used to analyze time-series data from 1980 to 2018, to determine the impact of remittances increases and decreases on environmental degradation in Nigeria. The cointegration results show that remittances and environmental degradation have a long-run relationship. The study found that remittances is asymmetrically connected to ecological footprint (EFP) as a measure of environmental degradation both in the long run and short run whereas it is asymmetrically connected with CO₂ as a measure of environmental degradation in the long run only. The study also found that remittances increase contributes to environmental degradation in Nigeria in the long run.