An Empirical Analysis of Remittance Flows Into West African Economic and Monetary Union: A Panel Time-Series Approach

Abstract

The article empirically analyses the motivations and long-run economic outcomes of remittance inflows into the West African Economic and Monetary Union. Using Westerlund’s (2007) ECM for panel time series and data spanning 1975–2011, the results show that there is no evidence of a long-run impact of remittances on income per capita in the region. The inflows seem to be motivated by investment, but the money may be used to promote consumption instead. This phenomenon could be characterized by information asymmetry between migrants and the recipients.

Keywords: Remittances; West African Economic and Monetary Union; Panel Time-Series Cointegration

JEL Classification: F24; O10