International Remittances and Economic Growth in Some Selected Sub-Saharan African Countries: Evidence from Panel Co-integration Approach

Abstract

International Remittances and Economic Growth in Some Selected Sub-Saharan African Countries: Evidence from Panel Co-integration Approach Ishaq Saidu, Ali Salisu Abstract Remittances is now the largest international flow to Africa. In Sub-Sahara Africa,it grew by 10 percent to $46 billion in 2018, accounting forabout 3 percent of the GDP of the subcontinent.This studyanalyzes the long run relationship of remittances and economic growth in some selected SSA countries,namely, Nigeria, Ghana, Kenya and Senegal, using annual panel data for the period of 1980-2018. The studyemployed LLC and IPS panel unit root test, Pedroni and Kao co-integration test to investigate structural and causal relationship between variables. From the long run cointegrating parameter estimates,the results suggest that an increase in remittances, foreign direct investment, trade openness and domestic investment, increases economic growth of SSA countries. Therefore, the study recommends that there is the need for SSA to design policies, programs as well as the institutional reform that will encourage the productiveuse of remittances. Full Text: PDF DOI: 10.15640/jeds.v8n2a6