Abstract
One of the main indicators seen in reviewing the relationship between international workers and economic growth is remittances. Remittances obtained from workers abroad are one of the major sources of finance for developing countries. Remittances are also a source of finance in increasing migrant household incomes which encourage improved consumption which will affect economic growth. This study was conducted to explore the impact of migrant remittances, consumption and FDI on economic growth in 10 ASEAN countries using annual panel data from 2015-2019. This study uses panel data regression analysis with the Random Effect Model (REM) approach. The results showed that remittances, consumption and FDI positively and significantly contributed to economic growth in 10 ASEAN countries. Significant contribution of migrant remittances in economic growth if their use is directed to more productive sectors such as use in the investment sector can help the economies of ASEAN countries to maintain and increase economic growth. The government needs to improve the quality of migrant workers through education because a high level of education will affect the level of wages received by migrants and will have an impact on increasing remittances. The limitation in this study is the use of limited data, for 2020 it is not included in the data set used in the analysis. For this reason, further research should use 2020 data because in 2020 there be a new phenomenon, namely COVID-19 which can be traced to the impact of this phenomenon on remittances. Keywords: Remittances, Migrant, Economic Growth, Panel Data
Highlights
Economic growth is an indicator of the success of development in an economy
Based on the estimation results of the model of the effect of remittances, consumption, Foreign Direct Investment (FDI) on economic growth in ASEAN countries, namely Indonesia, Vietnam, Myanmar, Brunei Darussalam, Cambodia, Laos, Malaysia, Singapore, Thailand, and the Philippines which is processed by panel data regression, the results show the results of the test
The Lagrange multiplier (LM) has a probability value of 0.0423 which is smaller than the 5% significance level, concluding that the best model that can be used in analyzing this research is the Random Effect Model (REM)
Summary
Economic growth is an indicator of the success of development in an economy. The progress of an economy is determined by the amount of growth indicated by changes in national output (Dewi et al, 2013). The consequence of economic integration is that each country must simplify the system in granting permits and facilitate the entry and exit of international workers involved in trade in goods, services and investment (Winantyo et al, 2015). Introduction presents the background, reason of the research, problem, research gap, research objectives clearly stated so that the reader can understand and evaluate the results achieved from the research conducted without having to read the previous publications related to the relevant topic. Use literatures that can really support disclosure of disclosed backgrounds. Introductory chapter should contain the background and purpose of the study
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