ECONOMIC AND NONECONOMIC FORCES ON REMITTANCE RECEIVING: A PANEL ANALYSIS OF TOP REMITTANCE SENDING COUNTRIES TOWARDS BANGLADESH (original) (raw)

Driving Forces of Remittance Inflow in Bangladesh: An Empirical Study

International Journal of Economics and Finance, 2015

This paper empirically investigates the major driving forces of remittance inflow in Bangladesh. Using annual data over the period from 1977 to 2011 the paper concludes that gross domestic products of host country and domestic country, exchange rate, petroleum price and skill of labour significantly influence remittance inflow in Bangladesh. One finding of the research is that skilled labour force rather sends smaller amount of remittance to the home country than the unskilled labour. This is due to the fact that skilled people do not maintain close tie with the home country because they often take their families with them to foreign countries where they work. Because of narrow opportunities, unskilled labour cannot take their families with them and hence send money to their families. The study also identifies the reason behind migration of manpower from Bangladesh to foreign countries. Presence of surplus labour, slim job opportunity, unfavourable working environment, poor wage rate, inadequate social security and political instability largely induce people to migrate abroad.

The macroeconomic determinants of remittances in Bangladesh

Bangladesh. Various regressions in the paper find that the macroeconomic variables such as inflation, interest rate, exchange rate of Bangladesh and GDP of the five remittance sending countries have significant impact on remittance. In the analysis it is found that if the domestic interest rate goes up by 1%, on average, then the remittance will increase by 1.94%. Therefore, remittance in Bangladesh is very responsive to changes in the domestic interest rate. Again, if the GDP of the rest of the five countries increases by 1%, then remittance will increase by 3.06 % *The author is a Senior Research Associate at

Macroeconomic Factors Influencing Foreign Remittances: The Case of Bangladesh

This paper examines the influence of few selected macroeconomic factors which are assumed to have influence on the flow of foreign remittances in Bangladesh. Yearly data between 1976 and 2011 have incorporated and a multivariate time series regression model have been designed to estimate the absolute relationship between remittances and macroeconomic determinants. It has found that professional and unskilled migrant have very low negative but significant regression coefficients but semi-skilled migrants have positive significant coefficient. Among other macroeconomic factors deposit interest rates and foreign exchange rates are also found to have statistically significant coefficients. Test of Granger causality reveals that foreign remittances have bi-directional causality with semi-skilled and un-skilled migrants and have uni-directional causality from professional migrants to remittances and remittances to DSE all share price index. However, extensive investigation is very essential to identify other macroeconomic factors that might cause the flow of foreign remittances in Bangladesh.

The Effect of Macroeconomic Variables on the Inflow of Remittance in Bangladesh

Bangladesh is one of the biggest remittances receiving country in this world and maintains this status from several years. This amount is about 12% of GDP and more than half of total export earnings. According to a World Bank Report Bangladesh is amongst the top ten nations which receive huge amount of remittances from abroad and for this Bangladesh‟s foreign exchange reserve has significantly gone up in 2013.In the last several years, Bangladesh‟s foreign exchange reserve continued to puff up crossing the 16−billionmark.Furthermore,ifthetotalamountofmoneythatisremittedthroughinformalchannelsisalsotakenintoaccount,thetotalamountofremittancethatisreceivedinBangladeshwillsoaruptohighermagnitudes.ThemajorsourceofremittanceinflowinBangladeshisthefromtheMiddleEasterncountries.Asnotedbyanofficialassociatedwithlabormigration,"remittanceshavebeencausingasilenteconomicrevolutioninBangladesh.”Thecountryisexpectedtoreceive16-billion mark. Furthermore, if the total amount of money that is remitted through informal channels is also taken into account, the total amount of remittance that is received in Bangladesh will soar up to higher magnitudes. The major source of remittance inflow in Bangladesh is the from the Middle Eastern countries. As noted by an official associated with labor migration, "remittances have been causing a silent economic revolution in Bangladesh.” The country is expected to receive 16−billionmark.Furthermore,ifthetotalamountofmoneythatisremittedthroughinformalchannelsisalsotakenintoaccount,thetotalamountofremittancethatisreceivedinBangladeshwillsoaruptohighermagnitudes.ThemajorsourceofremittanceinflowinBangladeshisthefromtheMiddleEasterncountries.Asnotedbyanofficialassociatedwithlabormigration,"remittanceshavebeencausingasilenteconomicrevolutioninBangladesh.”Thecountryisexpectedtoreceive15.05 billion in 2014, enough to retain theeighth position it held last year, says the WB's Migration and Remittance Unit.

Impact of Remittance on the Socio-economic Condition of Bangladesh

Bangladeshi workers working abroad are a very significant source of foreign exchange earnings for the country. Remittance is one of the most important economic indicators in Bangladesh as it influences the country's balance of payments, foreign exchange reserve, national savings, reserve money and money supply. Remittance earning is increasing day by day and is now the second largest source of foreign exchange earnings after exports. A migrant worker seeking employment abroad faces a lot of problems and challenges. However, concerns that manpower brokers both in the labor sending and destination countries often engage in unethical practices that cause enormous despair for the aspirant migrant workers. Migration as well as remittance contributes to a significant reduction in poverty and economic development of our country. On the other hand it has many unmeasured impacts. In this paper, the researcher conducted a research using primary and secondary data to reveal the real impact of remittance on the socio-economic condition of Bangladesh.

Foreign remittance inflow in Bangladesh: A statistical analysis

Global Journal of Business, Economics and Management: Current Issues

The major goal of this research is to assess Bangladesh's foreign remittance inflows. In recent years, remittance has risen to prominence as one of the most important economic variables, since it helps with the surplus balance of payments, foreign reserves, aggregate savings and money circulation. Bangladesh's foreign trade has begun to improve after overcoming the negative effects of the COVID-19 pandemic. In comparison to the previous fiscal year, total export earnings declined by 16.93% to US$ 33,674.09 million in FY2019–20. During the first half of fiscal year 2020–21, export earnings totalled US$ 35,180.81 million, up 13.64% over the same period of the previous fiscal year. Furthermore, remittance earnings are growing at a slower rate than emigration from Bangladesh, owing to a rising number of unskilled or semi-skilled labourers in overseas migration rather than professional. Remittances have a great impact on Bangladesh's economy. Keywords: Foreign remittance, mon...

Utilization of International Remittances in Bangladesh

The study explores the significant factors and utilization of international remittance in Bangladesh by using primary data from 84 migrant households. The study applies multiple linear regression model estimated by OLS method. The estimated results find that household size, training, skill, years at abroad and earnings significantly affect international remittance in Bangladesh. This indicates migrants remit home motivated by mixed views like, altruistic, loan repayment and exchange view. The study also finds 50.01 percent of remittance is utilized only in consumption of food purpose. The study suggests arranging training and skill enhancing programs to migrants and creating investment opportunities.

Can Government Incentive on Remittance Encourages Remitters in Bangladesh? A Policy Study

ICRRD Quality Index Research Journal

The government's recent two percent remittance incentive has attracted the attention of remitters and policymakers in Bangladesh. The purpose of this inward remittance incentive policy is to encourage remitters to send money in a legal manner. This will minimize illegal money transfers from overseas, and the government will be able to grow the reserve. The goal of this research is to investigate if the policy has had any recent impact on remitters and if there has been any change in money flow from overseas to Bangladesh through legal channels. We investigated using Bangladesh Bank remittance data and discovered a significant increase in the Bangladesh remittance flow in FY 2020-2021. In correlation matrix analysis using Pearson product correlation matrix this study has found Bangladesh's reserve and remittances are more closely linked than those of Bhutan, Pakistan, and Sri Lanka, following Nepal and India. However, the Pearson product correlation value for Pakistan and Sri...

Remittance and Its Impact on the Economy of Bangladesh

Education Times

With the increasing demand for its workforce from abroad, the remittance inflow in the economy of Bangladesh is enormously flowing every passing year. The multifold ensuing development impact on the economy includes reducing poverty, helping in maintaining the balance of payment, increasing foreign exchange reserves, and enhancing national savings. The relative weight of remittances has also increased against most macroeconomic variables alongside the contribution to GDP. Additionally, Remittances have helped improve the social and economic indicators like nutrition, living condition and housing, education, health care, social security, and investment activities of the recipient households. Keywords: Remittance, macro, economy, Bangladesh