Effect of remittances on the Human Development Index: evidence for 84 countries worldwide during the period 2000-2016

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Published: nov. 9, 2020
Keywords:
Remittances, Human Development Index, Panel data

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Susana Pineda
Universidad Nacional de Loja
Pablo Ponce
Universidad Nacional de Loja

Abstract

In 1990 the United Nations Development Program published its first report on Human Development. For nearly thirty years, it has served as an inspiration and a basis for adopting solutions and policies around the world. Thus, it is essential to analyze the influence of remittances on human development due to its improvement in households' quality of life. This research aims to determine the effect of remittances on the Human Development Index (HDI) using panel data models with GLS regressions. The data was taken from the World Bank (2019) and the Human Development Index and Indicators database (2018). The dependent variable is the HDI, the independent variable is remittances, and as control variables: the income from natural resources, manufacturing, unemployment, economic growth, and urban population. The results indicate that remittances positively impact the Human Development index, just as manufacturing, economic growth, and the urban population positively affect the HDI. While the income from natural resources is not statistically significant, and unemployment has a negative relationship. Policy implications should consider channeling the use of remittances into quality health care, education, and reducing the costs of remittances. The development of the manufacturing sector should also be promoted and improve the living conditions of the rural population.

Article Details

How to Cite
Pineda, S., & Ponce, P. (2020). Effect of remittances on the Human Development Index: evidence for 84 countries worldwide during the period 2000-2016. Revista Económica, 8(1), 96–103. Retrieved from https://revistas.unl.edu.ec/index.php/economica/article/view/846
Issue
Vol. 8 No. 1 (2020): Revista Económica vol 8 (Enero-Junio 2020)
Section
RESEARCH ARTICLES
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