Macroeconomic Determinants of Remittances: Evidence from India

Author/Editor:

Poonam Gupta

Publication Date:

December 1, 2005

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Remittances to India have been growing rapidly since 1991, making it one of the largest recipients of remittances. This paper analyzes the determinants of remittances to India and finds that their growth over time can be explained by the increase in migration and total earnings of the migrants. Remittances are also affected by the economic environment in source countries, and appear to be countercyclical-that is, higher during periods of low economic growth in India. None of the remaining economic or political variables considered in the paper, including political uncertainty, interest rates, or exchange rate depreciation, are found to affect remittances significantly.

Series:

Working Paper No. 2005/224

Subject:

Capital account Current account Market exchange rates Oil prices Remittances

English

Publication Date:

December 1, 2005

ISBN/ISSN:

9781451862430/1018-5941

Stock No:

WPIEA2005224

Pages:

21

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