Economic Policy Uncertainty and Remittance Nexus: Evidence From Top 10 Remittance-receiving Countries
Economic Policy Uncertainty and Remittance Nexus: Evidence From Top 10 Remittance-receiving Countries

Summary/Abstract: Remittances are a major source of income for many countries, and their importance to national economies is increasing. Altruism and self-interest are the two main motivations for remitting, with economic policy uncertainty potentially determining which motivation is more prevalent. This study examines these hypotheses using unbalanced panel data to analyze remittances received by the top 10 recipient countries (accounting for half of global remittances). Due to cross-sectional dependence, methods with robust standard errors are employed. Consistent results across four different estimation methods show that economic policy uncertainty negatively impacts remittances, while economic growth has a positive impact. This indicates self-interest as the primary driver. Trade openness also positively contributes to remittance increases. The wealth effect, shaped by self-interest, leads to increased remittances from workers.

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