Remittance Inflow and Economic Growth: The Case of Georgia

  • Azer Dilanchiev International Black Sea University, Tbilisi, Georgia.
  • Ahmet Sekreter Suleyman Sah University, Istanbul
Keywords: Remittances Inflow, Economic Growth, Unit Root Test, VAR Granger Causality Test.


Remittance inflow become one of the main source of capital flows in the world. It is noted that remittance is very effective in promoting household welfare and as an alternative source of capital inflow. However in it uncertain whether or not it leads to economic growth. This article examines the effects of remittances inflow on economic growth in Georgian republic. The impact of remittance inflow on GDP growth was analyzed and tested by Unit Root Test, Johansen Co-integration and VAR Granger Causality/Block Exogeneity Wald Tests. In the paper the quarterly data interval from the first quarter of 1999 to third quarter of 2015 was used. As a result it was found out that that there is a nexus between remittance and GDP and it is concluded that remittance leads to increase in GDP growth.


Ahortor, C. R. K., and Adenutsi, D. E. (2009). The Impact of Remittances on Economic Growth in Small-Open Developing Countries. Journal of Applied Science, 9(18), pp.3275-3286

Barajas, A., Chami, R., Fullenkamp, C., Gapen, M., Montiel, P. (2009). Do workers’ remittances Promote economic growth? IMF Working Paper WP/09/153.

Bayar, Y.(2015). Impact of Remittances on the Economic Growth in the Transitional Economies of the European Union, Economic Insights – Trends and Challenges, Vol.IV(LXVII) No. 3/2015

Giuliano, P., Ruiz-Arranz, M. (2009). Remittances, financial development, and growth, Journal of Development Economics 90, pp. 144–152.

Ivakhnyuk, I., (2006). Migrations in the CIS Region: Common Problems and Mutual Benefits, International Symposium on International Migration and Development.

Kiio, J., Soi, N., Buigut,K., (2014). The Impact of Workers’ remittances On Economic Growth: Evidence from Kenya, Journal of Economics and Sustainable Development ISSN 2222-1700 (Paper) ISSN 2222-2855 (Online) Vol.5, No.26, 2014

Lopez, H., Molina, L., Bussolo. M. (2007). Remittances and the real exchange rate,, Accessed 25 December 2015.

Leon L.M. and Piracha M. (2004), International Migration and the Role of Remittances in Eastern Europe, International Migration, 42 65-83.

Nyamongoa, E.M., Misatib, R.N., Kipyegonb, L., Ndirangua, L. (2012). Remittances, financial Development and economic growth in Africa, Journal of Economics and Business 64, pp. 240– 260.

Ramey, G., Ramey, V.A. (1995). Cross-country evidence on the link between volatility and growth, American Economic Review 85 (5), pp. 1138–1151.

Pradhan, G., Upadhyay, M., Upadhyaya, K. (2008). Remittances and economic growth in developing Countries, the European Journal of Development Research 20(3), pp. 497–506.

Ramirez, M.D. and Sharma, H. (2008) Remittances and Growth in Latin America: A Panel Unit Root and Panel Cointegration Analysis, Department of Economics Yale University, Working Paper No. 51.

Jawaid S.T and Raza S.A. (2012). Remittances, Growth and Convergence: Evidence from Developed and Developing Countries,Munich Personal RePEc Archive (MPRA) Paper No 39002 Online at: http://mpra.ub.unimuenchen. de/39002.

Waheed,A. Aleem,A. (2008), workers’ remittances and economic growth: Empirical evidence from Pakistan, Journal of social science and humanities 47(1) pp.1-12

Sofranko, A.J. Idris, K. (1999), Use of Overseas Migrants’ Remittances to the Extended Family for Business Investment, a Research Note. Rural Sociology 64:464-481.

Sulaimanova, B. & Bostan, A. (2014). International Migration: A Panel Data Analysis of the Determinants of Emigration from Tajikistan and Kyrgyzstan. Eurasian Journal of Business and Economics 7 (13): 1-9.

How to Cite
Dilanchiev, A., & Sekreter, A. (2016). Remittance Inflow and Economic Growth: The Case of Georgia. Journal of Research in Business, Economics and Management, 6(2), 868-873. Retrieved from