Do emigrants' remittances cause Dutch disease? A developing countries case study

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F61989100%3A27510%2F19%3A10242070" target="_blank" >RIV/61989100:27510/19:10242070 - isvavai.cz</a>

Výsledek na webu

<a href="https://journals.sagepub.com/doi/10.1177/1035304619828560" target="_blank" >https://journals.sagepub.com/doi/10.1177/1035304619828560</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.1177/1035304619828560" target="_blank" >10.1177/1035304619828560</a>

Jazyk výsledku

angličtina

Název v původním jazyce

Do emigrants' remittances cause Dutch disease? A developing countries case study

Popis výsledku v původním jazyce

Although the positive socio-economic effects of remittances for recipient countries in the short term are unmistakable, inflows of remittances may at the same time exert adverse effects on the trade competitiveness of an economy, by appreciating the real exchange rate. This phenomenon is characterised as an instance of the Dutch disease&apos; - the negative impact of windfall revenue inflows on the competitiveness of other tradable sectors and hence on overall economic growth. While the real effect of workers&apos; remittances on real exchange rates in a recipient economy is still a controversial issue, several studies have analysed evidence for the existence of the Dutch disease&apos; phenomenon in various sets of countries. The main objective of this study is to examine whether remittance flows have had any adverse effect on the international trade competitiveness of a selected group of developing countries during the period from 1995 to 2014. Using a one-step system Generalised Method of Moments specification within a simultaneous equation approach, it shows that remittance flows depreciate the real exchange rate at their levels and that the lagged value of remittances create the Dutch disease for this country group. In addition, we confirm that while trade openness and world real interest rates contribute to a depreciation in real exchange rates, gross domestic product per capita and net Official Development Aid inflows tend to appreciate real exchange rates. A policy implication is that trade liberalisation policies that lower tariff rates on capital imports and new export-oriented incentive programmes should be accompanied by measures designed to prevent appreciation in the real exchange rate: steps in this direction such as recent macroeconomic and prudential capital flow management initiatives are briefly referenced.

Název v anglickém jazyce

Do emigrants' remittances cause Dutch disease? A developing countries case study

Popis výsledku anglicky

Although the positive socio-economic effects of remittances for recipient countries in the short term are unmistakable, inflows of remittances may at the same time exert adverse effects on the trade competitiveness of an economy, by appreciating the real exchange rate. This phenomenon is characterised as an instance of the Dutch disease&apos; - the negative impact of windfall revenue inflows on the competitiveness of other tradable sectors and hence on overall economic growth. While the real effect of workers&apos; remittances on real exchange rates in a recipient economy is still a controversial issue, several studies have analysed evidence for the existence of the Dutch disease&apos; phenomenon in various sets of countries. The main objective of this study is to examine whether remittance flows have had any adverse effect on the international trade competitiveness of a selected group of developing countries during the period from 1995 to 2014. Using a one-step system Generalised Method of Moments specification within a simultaneous equation approach, it shows that remittance flows depreciate the real exchange rate at their levels and that the lagged value of remittances create the Dutch disease for this country group. In addition, we confirm that while trade openness and world real interest rates contribute to a depreciation in real exchange rates, gross domestic product per capita and net Official Development Aid inflows tend to appreciate real exchange rates. A policy implication is that trade liberalisation policies that lower tariff rates on capital imports and new export-oriented incentive programmes should be accompanied by measures designed to prevent appreciation in the real exchange rate: steps in this direction such as recent macroeconomic and prudential capital flow management initiatives are briefly referenced.

Druh

J_imp - Článek v periodiku v databázi Web of Science

CEP obor

—

OECD FORD obor

50202 - Applied Economics, Econometrics

Projekt

—

Návaznosti

S - Specificky vyzkum na vysokych skolach

Rok uplatnění

2019

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

Economic and Labour Relations Review

ISSN

1035-3046

e-ISSN

—

Svazek periodika

30

Číslo periodika v rámci svazku

1

Stát vydavatele periodika

GB - Spojené království Velké Británie a Severního Irska

Počet stran výsledku

18

Strana od-do

59-76

Kód UT WoS článku

000461570600004

EID výsledku v databázi Scopus

2-s2.0-85061574544