Author : Erik Lueth
Publisher : International Monetary Fund
ISBN 13 :
Total Pages : 20 pages
Book Rating : 4.:/5 (318 download)
Book Synopsis Are Workers' Remittances a Hedge Against Macroeconomic Shocks? the Case of Sri Lanka by : Erik Lueth
Download or read book Are Workers' Remittances a Hedge Against Macroeconomic Shocks? the Case of Sri Lanka written by Erik Lueth and published by International Monetary Fund. This book was released on 2007-02 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt: We estimate a vector error correction (VEC) model for Sri Lanka to determine the response of remittance receipts to macroeconomic shocks. This is the first attempt of its kind in the literature. We find that remittance receipts are procyclical and decline when the island's currency weakens, undermining their usefulness as shock absorber. On the other hand, remittances increase in response to oil price shocks, reflecting the fact that most overseas. Sri Lankan are employed in the Gulf states. The procyclicality of remittances calls into question the notion that remittances are largely motivated by altruism.