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Remittances, Banking Sector Development and Economic Growth in Fiji

Author

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  • Janesh Sami

    (Department of Economics, Banking and Finance College of Business, Hospitality and Tourism Studies Fiji National University, Nasinu, Fiji Islands)

Abstract

This study examines the role of remittances and economic growth in banking sector development in Fiji using annual data from 1980-2010. This study finds evidence of long run relationship between banking sector development, remittances and economic growth using bounds testing procedure developed by Pesaran et al. (2001). In addition, our causality analysis based on vector error correction model (VECM) and Toda Yamamoto Granger Non Causality test (1995) suggest that there is causality from economic growth and remittances to banking sector development. The study indicates that remittances inflows may not be only important for economic growth but also for development of banking sector. It is thus, important for policymakers to ensure that remittances flow through formal channels.

Suggested Citation

  • Janesh Sami, 2013. "Remittances, Banking Sector Development and Economic Growth in Fiji," International Journal of Economics and Financial Issues, Econjournals, vol. 3(2), pages 503-511.
    • Handle: RePEc:eco:journ1:2013-02-22
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    References listed on IDEAS

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    1. Demirgüç-Kunt, Asli & Córdova, Ernesto López & Pería, María Soledad Martínez & Woodruff, Christopher, 2011. "Remittances and banking sector breadth and depth: Evidence from Mexico," Journal of Development Economics, Elsevier, vol. 95(2), pages 229-241, July.
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    Cited by:

    1. Ibrahim M. Awad & Mohammed S. Karaki, 2019. "The impact of bank lending on Palestine economic growth: an econometric analysis of time series data," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 5(1), pages 1-21, December.
    2. Hasan Dinçer & Serhat Yüksel & Fatih Pınarbaşı & Mehmet Ali Alhan, 2020. "Risky Financial Assets in Financial Integration and the Impacts of Derivatives on Banking Returns," World Scientific Book Chapters, in: Stéphane Goutte & Khaled Guesmi (ed.), Risk Factors and Contagion in Commodity Markets and Stocks Markets, chapter 6, pages 133-159, World Scientific Publishing Co. Pte. Ltd..
    3. Brito, Joao, 2015. "Country Size and Determinants of Economic Growth: A Survey with Special Interest on Small States," MPRA Paper 61273, University Library of Munich, Germany.
    4. repec:kqi:journl:2017-1-6 is not listed on IDEAS
    5. Dambar Uprety, 2017. "The Impact of Remittances on Economic Growth in Nepal," Journal of Development Innovations, KarmaQuest International, vol. 1(1), pages 114-134, February.

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    More about this item

    Keywords

    : Remittances; Economic growth; Banking sector development; Bounds testing procedure;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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