39th Annual Student Research Conference
What is the impact of remittance inflows on Nepal’s GDP growth?
Upendra Chapagain
Dr. Xiaofen Chen, Faculty Mentor
This study investigates the impact of remittance inflows on GDP growth with a main focus on Nepal and five comparable remittance-dependent economies, which include Bangladesh, India, Pakistan, Sri Lanka, and the Philippines, over the period 1993–2024, controlling for capital stock, labor force, FDI, human capital, trade openness, savings, inflation, and population growth. The results show that remittance inflows have a negative and statistically significant effect on GDP growth across both individual countries and pooled regressions, suggesting that remittances in these economies primarily support household consumption rather than productive investment. In addition, evidence is found that stronger financial systems can partially offset this negative effect, and that saving and FDI are the primary positive drivers of GDP growth. These findings suggest that policy efforts should focus on channeling remittances toward savings and investment through financial sector development to unlock their potential as an engine of economic growth.
Keywords:
Topic(s):Economics
Presentation Type: Oral Presentation
Session: 3201-4
Location: SUB 3201
Time: 9:15