Do remittances promote financial development?

Aggarwal, Reena; Demirgüç-Kunt, Aslı; Pería, María Soledad Martínez

doi:10.1016/j.jdeveco.2010.10.005

Cited by 481 publications

(358 citation statements)

References 30 publications

(9 reference statements)

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“…First, like with remittances (Aggarwal et al, 2011;Efobi et al, 2014), development assistance that is utilised effectively in recipient countries and survives the capture of consultancy services in donor countries, has a high likelihood of improving financial development in the recipient countries.…”

Section: Theoretical Highlights and The Empirical Literaturementioning

confidence: 99%

Technology-driven information sharing and conditional financial development in Africa

Asongu

Anyanwu

Tchamyou

2017

Information Technology for Development

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Information technology is increasingly facilitating mechanisms by which information asymmetry between lenders and borrowers in the financial sector can be reduced in order to enhance financial access for human and economic development in developing countries. We examine sharing on financial depth (money supply and liquid liabilities) and financial activity (at banking and financial system levels). Second, for financial intermediation efficiency, the positive effects from mobile-driven information sharing are apparent exclusively in certain levels of financial efficiency. Third, with regard to financial size, mobile-driven information sharing is positive with a negative threshold, whereas, internet-driven information sharing is positive exclusively among countries in the bottom half of financial size. Positive thresholds are defined as decreasing negative or increasing positive estimated effects from information sharing offices and vice-versa for negative thresholds. Policy implications are discussed.JEL Classification: G20; G29; O16; O55; C52

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Section: Theoretical Highlights and The Empirical Literaturementioning

confidence: 99%

Technology-driven information sharing and conditional financial development in Africa

Asongu

Anyanwu

Tchamyou

2017

Information Technology for Development

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“…These large monetary inflows affect microand macroeconomic outcomes in the receiving countries. For example, the literature has demonstrated that remittances affect the quality of governance (Ahmed 2012;Ahmed 2013;Berdiev et al 2013), financial sector development (Giuliano and Ruiz-Arranz 2009;Aggarwal et al 2011), exchange rate regimes (Singer 2010), international competitiveness (López et al 2008;Acosta et al 2009) and schooling decisions (Edwards and Ureta 2003;Alcaraz et al 2012;Ambler et al 2015). 1 Despite their enormous importance, little research exists on the relevance and impact of inflowing remittances for public finances of receiving countries.…”

Section: Introductionmentioning

confidence: 99%

Remittances and public finances: Evidence from oil-price shocks

Asatryan

Bittschi

Doerrenberg

2017

Journal of Public Economics

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Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW.Remittances and Public Finances: Evidence from Oil-Price Shocks * Zareh Asatryan Benjamin Bittschi Philipp DoerrenbergMarch 3, 2016 AbstractWe study the effect of inflowing remittances -a major source of capital for many countries -on tax-revenues and tax-policy. Instrumenting remittances with changes in the oil-price interacted with a country's distance to oil-producing countries, we find that remittances have a large positive effect on VAT revenues but no effect on income-tax revenues. This suggests that remittances often escape the income tax but can be taxed via consumption. We further show that tax policy is responsive to shocks in incoming remittances: remittances make the adoption of VAT-systems more likely, and they lead to lower VAT-rates and higher income-tax rates.JEL Classification: F24, H20, O23.

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“…These include remittances and financial development (Shahbaz et al 2007, Nyamongo andMisati, 2011;Aggarwal et al 2010), remittances and sustainable economic development like welfare effect (Gupta, 2009;Siddiqui and Kemal 2006;Adams and Page 2005;Adam, 1993); economic growth effect (Taylor and Wyatt, 1996;Esman et al 2012); increasing consumption effect (Quartey and Blankson 2004); human capital formation (Edwards and Ureta, 2003;Hanson and Woodruff, 2003); remittances and education and schooling (Calero et al 2008;Richard et al 2010); remittances and Dutch disease (Acosta et al 2009;Bourdet and Falck, 2006;Lartey et al 2008;Vargas-Silva, 2009 etc. ), remittances and real exchange behavior (Amuedo-Dorantes and Pozo, 2004;Chami et al 2003) etc.…”

Section: Introductionmentioning

confidence: 99%

“…), remittances and real exchange behavior (Amuedo-Dorantes and Pozo, 2004;Chami et al 2003) etc. Studies on remittances and financial development conclude that remittances channeled through the formal financial channel affect the its growth by standardizing the local banking sector up to the international standard following global practices (Nyamongo and Misati 2011;Aggarwal et al 2010, Shahbaz et al 2007). …”

Section: Introductionmentioning

confidence: 99%

Remittance and domestic labor productivity: Evidence from remittance recipient countries

et al. 2015

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For countries with significant labor force like China, India, Bangladesh, Pakistan etc. any longrun growth strategy should focus on augmenting the domestic labor productivity. The advent of globalization and factor mobility has given a recipe to reap up gains from labor abundance for most of the labor abundant countries by strategically converting abundant labor into capital. However, remittance inflow may become counterproductive strategy for growth, if it is viewed within the work-leisure framework. Using heterogeneous non-stationary panel data with crosssectional bias this empirical study explores the best fitted estimator to explain remittance and labor productivity dynamics for 21 top remittance recipient countries of the world. Our results suggest that though remittance has a positive impact on domestic labor productivity; however, there is new evidence that such impact diminishes after certain level.

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Do remittances promote financial development?

Cited by 481 publications

References 30 publications

Technology-driven information sharing and conditional financial development in Africa

Technology-driven information sharing and conditional financial development in Africa

Remittances and public finances: Evidence from oil-price shocks

Remittance and domestic labor productivity: Evidence from remittance recipient countries

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