Modeling the Impact of Policy Environment on Inflows of Worker's Remittances in Pakistan: A Multivariate Analysis

Research Journal Social Sciences (RJSS), Volume 5, No. 1

17 Pages Posted: 4 Dec 2017

See all articles by Muhammad Jawad

Muhammad Jawad

Quaid-i-Azam University - Pakistan Institute of Development Economics (PIDE)

Abdul Qayyum

Pakistan Institute of Development Economics (PIDE)

Date Written: November 29, 2016

Abstract

The study investigates relevant significance of various economic determinants for inflows of worker’s remittances to Pakistan. Following precedence from the policy index developed by Burnside and Dollar (2000), we develop a policy index for Pakistan and use it as a proxy for estimating the relationship of this policy index with the remittances in Pakistan. The study has also taken other conventional macroeconomic determinants into account such as GDP, exchange rate, labor force participation and interest rate spread for having efficient and precise coefficient estimates of our estimated model. The study finds that during the period (1972-2011) policy environment is one of the significant determinants of worker’s remittances in Pakistan. Further, the application of several post estimation tests ascertains that our empirical model is robust and the coefficient estimates are BLUE.

Keywords: Workers’ remittances, Growth, Policy index, Cointegration, Dynamic Error Correction

JEL Classification: E22

Suggested Citation

Jawad, Muhammad and Qayyum, Abdul, Modeling the Impact of Policy Environment on Inflows of Worker's Remittances in Pakistan: A Multivariate Analysis (November 29, 2016). Research Journal Social Sciences (RJSS), Volume 5, No. 1, Available at SSRN: https://ssrn.com/abstract=3079726

Muhammad Jawad

Quaid-i-Azam University - Pakistan Institute of Development Economics (PIDE) ( email )

Quaid-i-Azam University Campus
P.O.Box 1091
Islamabad, Federal Capital 44000
Pakistan

Abdul Qayyum (Contact Author)

Pakistan Institute of Development Economics (PIDE) ( email )

Pakistan Institute of Development Economics (PIDE)
P.O.Box 1091
Islamabad, Federal Capital 44000
Pakistan

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