Assessing the Impact of Emigration and Remittances on the Economic Growth in Ghana

Abstract

Workers remittances play a significant role in the lives of receiving households and beneficiaries especially in Ghana. The study employed a time series data spanning from 1990-2018, to assess the impact of Emigration and Remittances on the economic growth in Ghana. There have been contradictory findings in current empirical research on the contribution of workers’ remittances to economic growth. This study discovered that, Emigration and Remittances have a negative impact on the economic growth in Ghana. Actually, most of receiving household spends most of the remitted money on consumption, conspicuous spending and debt repayment rather than investment and savings. Moreover, most remittances receiving families are counterproductive to the labor participation rate in the recipient nations since most of them become reluctant to engage themselves in any productive work as a result of income received from family members abroad, thereby reducing supply of labor and economic cycle. The regression model contains other control variables like Trade, Gross Fixed Capital Formation and Foreign Direct Investment. The main task for the government of Ghana, given the critical position of Emigration and Remittances, is to give and supply opportunities to draw more remittances sent across structured channels and to ensure their effective and efficient usage.