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Economies 2016, 4(4), 28; doi:10.3390/economies4040028

Remittances, Development Level, and Long-Run Economic Growth

Department of Economics, Šiauliai University, Šiauliai LT-77156, Lithuania
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Academic Editor: Jacques Poot
Received: 13 June 2016 / Revised: 1 November 2016 / Accepted: 22 November 2016 / Published: 1 December 2016
(This article belongs to the Special Issue Long-Run Economic Impacts of International Migration)
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Abstract

This paper seeks to enrich the field of research on the topic of the impact of remittances on long-run economic growth. Using an unbalanced panel data covering a sample of 116 countries with different development levels over the period 1990–2014, we studied the interaction between remittances and the level of economic development, as well as its impact on long-run economic growth—because the impact of remittances could be influenced by the development level of the receiving countries. In parallel, we explored the hypothesis about diminishing a country’s capacity to use remittances for promoting long-run economic growth as the abundance of remittances increases. To control the endogeneity while estimating the impact of remittances on long-run economic growth, we used OLS (ordinary least squares) with FD (first differences) transformation and FE (fixed effects) approaches and other controls of long-run growth. Our results showed that in general remittances have a positive impact on long-run economic growth, but the impact differs based on the country’s economic development level and the abundance of remittances in the economy. View Full-Text
Keywords: remittances; long-run economic growth; development level remittances; long-run economic growth; development level
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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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MDPI and ACS Style

Matuzeviciute, K.; Butkus, M. Remittances, Development Level, and Long-Run Economic Growth. Economies 2016, 4, 28.

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