Remittances, growth and poverty: new evidence from Asian countries
This study re-examines the effects of remittances on the growth of GDP per capita using annual panel data for 24 Asia/Pacific countries. The results generally confirm that remittance flows have been beneficial to economic growth. However, the analysis also shows that the volatility of capital inflows such as remittances and foreign direct investment is harmful to economic growth. In other words, while remittances contribute to better economic performance, they are also a source of output shocks. Finally, remittances contribute to poverty reduction – especially through their direct effects. Migration and remittances are thus potentially a valuable complement to broad-based development efforts.