Author: Imen Mohamed Sghaier
This paper investigates the conditional effects of remittances on economic growth in 7 MENA countries, namely, Tunisia, Morocco, Algeria, Egypt, Jordan, Lebanon, and Turkey from 2000 to 2018. Using the system generalized method of moments (GMM) in a panel data analysis, we found strong evidence of a positive relationship between remittances and economic growth. We also found that financial development acted as a complement in the remittances-growth relationship. A clearer understanding of the channels through which remittance flows will enhance economic growth in the MENA region may assist policymakers to formulate appropriate policies. In particular, a policy environment that promotes financial system development would serve to attract more remittances.