Macroeconomic Determinants of Workers’ Remittances and Compensation of Employees in Sub-Saharan Africa

Adenutsi, Deodat E. (2013): Macroeconomic Determinants of Workers’ Remittances and Compensation of Employees in Sub-Saharan Africa. Published in: Journal of Developing Areas , Vol. 48, No. 1 (2014): pp. 337-360.

Abstract

In this paper, an attempt has been made to identify the macroeconomic determinants of migrant remittances received in Sub-Saharan Africa (SSA) at the disaggregated level. The underlying motivation is that, given their unique characteristics, permanent and temporary migrants are likely to respond differently to macroeconomic conditions in migrant-host countries and their native or migrant-home countries. For the empirical analysis, the system Generalized Method of Moments (GMM) approach was used to estimate a dynamic panel-data model involving 36 SSA countries over the period, 1980-2009. It was found that the inflows of compensation of employees and workers’ remittances to SSA are influenced by host-country macroeconomic conditions in a similar way, whereas these two forms of remittances are driven by contrasting home-country macroeconomic conditions. Remittances from permanent migrants are less altruistic than remittances from temporary migrants. To attract higher remittances on a more permanent basis, the implementation of stable macroeconomic and pro-growth policies are inevitable in labor-exporting SSA countries.

• Item Type: MPRA Paper
• Language: English
• Keywords: Workers’ Remittances, Compensation of Employees, Money, Migrant, International Migration, sub-Saharan Africa
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C23 - Panel Data Models ; Spatio-temporal Models; E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E42 - Monetary Systems ; Standards ; Regimes ; Government and the Monetary System ; Payment Systems; F - International Economics > F2 - International Factor Movements and International Business > F22 - International Migration; F - International Economics > F2 - International Factor Movements and International Business > F24 - Remittances; J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J33 - Compensation Packages ; Payment Methods

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