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Volume :26 Issue : 3 1998      Add To Cart                                                                    Download

DETERMINANTS OF ARAB MIGRANT REMITTANCES

Auther : Mohammed EL-Sakka

The author investigates the determinants of remittance inflows to Arab labor sending countries. EL-Sakka uses the econometric model based on an aggregation of remittance uses in the countries of origin using a panel of time series cross section data for Algeria, Egypt, Jordan, Morocco, Sudan, Syria, Tunisia, and Yemen.

Results show that economic growth in the countries of origin is an important determinant of remittance inflows. Economic growth will not only mobilize domestic resources to investment, but also will mobilize different forms of foreign capital including remittance. Inflation rates in the country of origin have a positive relationship with the inflow of remittance. Also, there is a negative relationship between differences in interest rates at home and abroad, and the inflow of remittance. Finally, deviations of exchange rated from their real levels have a negative relationship to remittance inflows. EL-Sakka discusses the implications of these results for policy making in countries of origin along with an integrated approach to attract remittance.

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