Altruism and Workers’ Remittances: Evidence from Selected Countries in the Middle East and Central Asia
IMF Working Papers, May 1, 2006
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- Altruism and Workers’ Remittances: Evidence from Selected Countries in the Middle East and Central Asia
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Bibliographic details
- Authors: Jacques Bouhga-Hagbe
- Published: May 1, 2006
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451863901.001
Summary and main findings
- Workers' remittances have been playing an increasingly important role in the balance of payments of many countries and can significantly contribute to the strength of their external positions.
- Assessing the likely stability of remittance flows is a valuable input to the analysis of external vulnerabilities.
- The paper argues that "altruism," as a motive to send money home, would contribute to the stability of remittance flows.
- Evidence suggests that altruism could have played an important role in the flow of remittances to Egypt, Jordan, Morocco, Pakistan, and Tunisia in recent years.
Methodology and key indicator
- Uses a simple framework that relates workers' remittances to agricultural GDP.
- Agricultural GDP is used as an indicator of economic "hardship" in the home country.
- The relationship between remittances and agricultural GDP is used to infer the presence and role of altruistic motives in remittance behavior.
Countries covered and empirical evidence
- Empirical evidence focuses on: Egypt, Jordan, Morocco, Pakistan, and Tunisia.
- For these countries, the analysis suggests that altruism could have played an important role in recent remittance flows.
Policy implications and analytical use
- Stability of remittance flows—when driven by altruism—can strengthen external positions and reduce external vulnerabilities.
- Incorporating likely stability of remittances into balance of payments analysis can improve assessments of external vulnerabilities.
Keywords and subject areas
- Subject: Exchange rates, External position, Outward remittances, Remittances, Service exports
- Keywords: exchange rate, money, money home, remittance, remittance flow, WP
Jacques Bouhga-Hagbe. "Altruism and Workers’ Remittances: Evidence from Selected Countries in the Middle East and Central Asia", IMF Working Papers 2006, 130 (2006), May 1, 2006, DOI: https://doi.org/10.5089/9781451863901.001