Article Sidebar

Submitted
May 11, 2024
Accepted
October 6, 2024
Published
October 31, 2024
Download
Full text PDF
Statistic
Read Counter : 149 Download : 121

Downloads

Download data is not yet available.

Main Article Content

Abstract

Purpose ― Drawing on annual data from 1996 to 2022, this study aims to examine the effect of Egypt’s real GDP growth.
Methods ― Autoregressive Distributed Lag (ARDL) and Cointegration technique are applied by first examining the stationarity of the series by utilizing the Augmented-Dicky-Fuller (ADF) unit root test. The bound cointegration test is then implemented to evaluate the existence of cointegration among the variables.
Findings ― The results indicate that the GDP growth rate has a long-run positive relationship with remittance inflows in Egypt. This paper also finds that the average governance indicators in Egypt, which include government effectiveness, political stability, control of corruption and regulatory quality, voice and accountability, and the rule of law, could help facilitate the long-run effect of remittances on GDP growth.
Implication ― The findings imply that maintaining high levels of governance indicators is essential for helping Egypt benefit from remittances and enhancing its economic growth.
Originality/value ― The study is a pioneer in including the average governance indicators in the remittance-growth nexus study for Egypt. Its purpose is to assess whether governance quality affects the nexus and whether there exists a threshold for the average governance indicators below which the flow of remittances does not encourage economic growth.

Keywords

remittances economic growth governance indicators ARDL model

Article Details

License

Copyright (c) 2024 Abdulrhman Alamoudi

Creative Commons License

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Authors who publish with this journal agree to the following terms:

  1. Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-ShareAlike 4.0 International License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
  2. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
  3. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).

Creative Commons License

Economic Journal of Emerging Markets by Center for Economic Studies, Universitas Islam Indonesia is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

How to Cite
Alamoudi, A. (2024). Do governance indicators have a role in remittances-growth nexus in Egypt?. Economic Journal of Emerging Markets, 16(2), 164–177. https://doi.org/10.20885/ejem.vol16.iss2.art6
Download Citation
Endnote/Zotero/Mendeley (RIS)
BibTeX

References

  1. Abdulai, A. M. (2023). The impact of remittances on economic growth in Ghana: An ARDL bound test approach. Cogent Economics & Finance, 11(2), 2243189. https://doi.org/10.1080/23322039.2023.2243189.
  2. Alamoudi, A. M. (2024). Does Control of Corruption Matter in the Nexus between Trade Openness and Economic Development? The Case of Saudi Arabia. Global Journal of Economics and Business, 14(3), 242-250. https://doi.org/10.31559/GJEB2024.14.3.4
  3. Mohamed, A. A., & Abdi, A. H. (2024). Exploring the dynamics of inflation, unemployment, and economic growth in Somalia: a VECM analysis. Cogent Economics & Finance, 12(1). https://doi.org/10.1080/23322039.2024.2385644
  4. Acemoglu, D., & Robinson, J. A. (2012). Why Nations Fail: The Origins of Power, Prosperity, and Poverty. New York: Crown Business.
  5. Adnan, K., Yin, K., Adrian, C. C., Cristina, G. Z., Sun, Q., & Duan, W. (2020). Is the relationship between remittances and economic growth influenced by the governance and development of the financial sector? New evidence from the developing countries. Romanian Journal of Economic Forecasting, 23(1), 37–56.
  6. Authers, J., & Leatherby L. (2019). As China’s Debt Balloons, Other Emerging Markets Fail to Take Of. https://www.bloomberg.com/graphics/2019-emerging-markets-debt/. Accessed 8 Apr 2020.
  7. Anetor, F. O. (2019). Remittances and Economic Growth Nexus in Nigeria: Does financial sector development play a critical role?. International Journal of Management, Economics and Social Sciences, 8(2), 116–135. https://doi.org/10.32327/IJMESS/8.2.2019.8
  8. Alemu, T. A., & Zegeye, M. B. (2024). Empirical investigation on the dynamics effects of population and economic growth in Ethiopia: an application of the VEC model. Cogent Social Sciences, 10(1). https://doi.org/10.1080/23311886.2024.2338861
  9. Alhassan, U. (2023) E-government and the impact of remittances on new business creation in developing countries. Economic Change Restructuring 56:181–214. https://doi.org/10.1007/s10644-022-09418-z.
  10. Alfada, A. (2023). The destructive effect of corruption on economic growth in Indonesia: A Threshold model, Heliyon, 5(10). https://doi.org/10.1016/j.heliyon.2019.e02649
  11. Arbia, A., Sobhi, K., Karim, M., & Eddaou M. (2023). FDI, Information and Communication Technology, and Economic Growth: Empirical Evidence from Morocco. Advances in Management and Applied Economics. 13(6), 1-10. https://doi.org/10.47260/amae/13610.
  12. Bucevska, V. (2022). Impact of Remittances on Economic Growth: Empirical Evidence from South-East European Countries. South East European Journal of Economics and Business, 17(1), 79-94. https://doi.org/10.2478/jeb-2022-0006.
  13. Chenery, H.B. (1967). Foreign Assistance and Economic Development. In: Adler, J.H. (eds) Capital Movements and Economic Development. International Economic Association Conference Volumes. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-15238-4_9
  14. Cazachevici, A., Havranek, T., & Horvath, R. (2020). Remittances and economic growth: A meta-analysis. World Development, 134, Article 105021. https://doi.org/10.1016/j.worlddev.2020.105021
  15. Chowdhury, M. (2016). Financial Development, Remittances and Economic Growth: Evidence Using a Dynamic Panel Estimation. Margin: The Journal of Applied Economic Research, 10(1), 35–54. https://doi.org/10.1177/0973801015612666
  16. Dickey, D. A., & Fuller, W. A. (1979). Distribution of the Estimators for Autoregressive Time Series with a Unit Root. Journal of the American Statistical Association, 74(366a), 427–437. https://doi.org/10.1080/01621459.1979.10482531
  17. Dokas, I., Panagiotidis, M., Papadamou, S., & Spyromitros, E. (2023). Does innovation affect the impact of corruption on economic growth? International evidence. Economic Analysis and Policy, 77(C), 1030-1054. https://doi.org/10.1016/j.eap.2022.12.032
  18. Engle, R., & Granger, C. (1987). Cointegration and error correction: Representation, estimation and testing. Econometrica, 55(2), 251–276. https://doi.org/10.2307/1913236
  19. Elsadig, M., & Rahim, K. (2023). FDI inflows spillover effect implications on the Asian‐Pacific labour productivity. International Journal of Finance & Economics, 28(1), 575-588. https://doi.org/10.1002/ijfe.2437. January
  20. Nkoro, E., & Uko, A. K. (2016). Autoregressive Distributed Lag (ARDL) Cointegration technique: Application and interpretation. Journal of Statistical and Econometric Methods, SCIENPRESS Ltd, 5(4), 1–3.
  21. Han, X., Khan, H., & Zhuang, J. (2014). Do Governance Indicators Explain Development Performance? A Cross-Country Analysis. Asian Development Bank Economics Working Paper Series No. 417. http://dx.doi.org/10.2139/ssrn.2558894.
  22. Hansen, B. E. (1999). Threshold effects in non-dynamic panels: Estimation, testing, and inference. Journal of Econometrics, 93(2), 345–368. https://doi.org/10.1016/S0304-4076(99)00025-1.
  23. Islam, M. S. (2022). Do personal remittances influence economic growth in South Asia? A panel analysis. Review of Development Economics, 26(1), 242–258. https://doi.org/10.1111/rode.12842.
  24. Imai, K. S., Gaiha, R., Ali, A., & Kaicker, N. (2014). Remittances, growth, and poverty: NEW evidence from Asian countries. Journal of Policy Modeling, 36(3), 524-538. https://doi.org/10.1016/j.jpolmod.2014.01.009
  25. Johansen, S., & Juselius, K. (1990). Maximum Likelihood Estimation and Inference on Cointegration—With Appucations to The Demand for Money. Oxford bulletin of economics and statistics, 52(2), 169–210. https://doi.org/10.1111/j.1468-0084.1990.mp52002003.x
  26. Jushi, E., Hysa, E., Cela, A., Panait, M., & Voica, M. C. (2021). Financing growth through remittances and foreign direct investment: Evidence from Balkan countries. Journal of Risk and Financial Management, 14(3), 117. https://doi.org/10.3390/jrfm14030117
  27. Matuzeviciute, K., & Butkus, M. (2016). Remittances, Development Level, and Long-Run Economic Growth. Economies, 4(28), 1–20. https://doi.org/10.3390/economies4040028.
  28. Tchekoumi, L. B., & Nya, P. D. (2023) Remittances and economic growth: What lessons for the CEMAC zone?, Cogent Economics & Finance, 11(1). https://doi.org/10.1080/23322039.2023.2191448.
  29. Menegaki, A. N. (2019). The ARDL Method in the Energy-Growth Nexus Field; Best Implementation Strategies. Economies, 7(4), 105. https://doi.org/10.3390/economies7040105
  30. Hadush, M., Gebregziabher, K. G., & Biruk, S. (2023). Determinants of economic growth in East African countries: A dynamic panel model approach. Cogent Economics & Finance, 11(2). https://doi.org/10.1080/23322039.2023.2239629
  31. Olayungbo, D. O., & Quadri, A. (2019). Remittances, financial development and economic growth in sub-Saharan African countries: evidence from a PMG-ARDL approach. Financial Innovation, 5(9). https://doi.org/10.1186/s40854-019-0122-8
  32. Oteng-Abayie, E., Awuni, P. A., & Adjei, T. K. (2020). The Impact of Inward remittances on Economic growth in Ghana. African Journal of Economic Review, 8(3), 49–65. https://doi.org/10.22004/ag.econ.308775.
  33. Peterson, E. W. F. (2017). The role of population in economic growth. SAGE Open, 7(4), 2158244017736094. https://doi.org/10.1177/2158244017736094
  34. Rehman, N. U., Hysa, E., & Poon, W. C. (2021). The effect of financial development and remittances on economic growth. Cogent Economics & Finance, 9(1). https://doi.org/10.1080/23322039.2021.1932060
  35. Sadiq, K., & Tsourapas, G. (2021). The Postcolonial Migration State, European Journal of International Relations, 27(3). https://doi.org/10.1177/13540661211000114
  36. Sutradhar, S. R. (2020). The impact of remittances on economic growth in Bangladesh, India, Pakistan, and Sri Lanka. International Journal of Economic Policy Studies, 14, 275–295. https://doi.org/10.1007/s42495-020-00034-1
  37. Sarker, B., & Khan, F. (2020). Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach. Financial Innovation, 6(10). https://doi.org/10.1186/s40854-019-0164-y
  38. Sobiech, I. (2015). Remittances, finance and growth: Does financial development foster remittances and their impact on economic growth?. FIW Working Paper Series, 158. https://hdl.handle.net/10419/121159
  39. DESA, U. N. (2020). The International Migration report (Highlights). Department of Economic and Social Affairs.
  40. Ustarz, Y., & Issahaku, H. (2017). International Migrant Remittance and Productivity Growth in Ghana. Ghana Journal of Development Studies, 14(2), 63–82. https://doi.org/10.4314/gjds.v14i2.4
  41. Yavuz, R. I., & Bahadir, B. (2022). Remittances, ethnic diversity, and entrepreneurship in developing countries. Small Business Economics, 58, 1931–1952. https://doi.org/10.1007/s11187-021-00490-9
  42. Zohry, A. (2013). Egypt's International Migration after the Revolution: Is There Any Change?. Confluences Méditerranée, 87, 47-54. https://doi.org/10.3917/come.087.0047.
No Related Submission Found