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ARDL Analysis of Remittance and Per Capita Growth Nexus in Oil Dependent Economy: The Nigeria’s Experience

Author

Listed:
  • Mathew Ekundayo Rotimi

    (Department of Economics, Federal University Lokoja, Kogi State, Nigeria)

  • Mishelle Doorasamy

    (School of Accounting, Economics and Finance, College of Law and Management Studies, University of KwaZulu Natal, Durban, South Africa)

  • Udi Joshua

    (Department of Economics, Federal University Lokoja, Kogi State, Nigeria)

  • Grace Gift Rotimi

    (Department of Business Administration, Prince Abubakar University, Anyigba, Nigeria)

  • Confort Omolayo Rotimi

    (Department of Economics, Federal University Lokoja, Kogi State, Nigeria)

  • Gabriel Samuel

    (Department of Accounting, Ibrahim Babangida University, Lapai, Niger State, Nigeria)

  • Gbenga Adeyemi

    (Wesley University, Ondo, ondo State, Nigeria)

  • Ayodele Solomon Alemayo

    (College of Education (Technical), Gbeleko, Kabba, Kogi State, Nigeria)

  • Alfred Kimea

    (Institute of Tax Administration, Tanzania)

Abstract

Purpose: Remittance is essential to economic wellbeing. Realising this fact, this study examined, within the optimist theoretical framework, whether international remittances significantly impact per capita economic growth in Nigeria. Design/methodology/approach: Employing annual time series data spanning 1980-2020, the study adopted the Pesaran, Shin, and Smith ARDL bounds estimating model to examine the type of relationships between remittances and Nigeria’s per capita growth. Finding: The study reveals a statistically significant positive nexus in the long-run and short-run among the variables. Specifically, it found that higher remittances inflow enhances per capita growth both in long-run and short-run in Nigeria. Furthermore, the study found that remittances are sources of external financing and eventually, it is a means to economic growth and also may help to fill fiscal deficit gap. Research limitations/implications: This study recommends that government should, through sound policy option, encourage remittances influx. This could be realised by creating viable relationship among international communities that largely account for remittance inflow into Nigeria. It further suggests a prudent and optimal management of remittances inflow through the appropriate monetary authority. This may include formulating policy that will ease remittance inflow and remove unnecessary barriers to inflow of remittances. Originality/value: The study contributes to literature by examining whether international remittances within the optimist theoretical framework significantly impact per capita economic growth (PCEG) in Nigeria.

Suggested Citation

  • Mathew Ekundayo Rotimi & Mishelle Doorasamy & Udi Joshua & Grace Gift Rotimi & Confort Omolayo Rotimi & Gabriel Samuel & Gbenga Adeyemi & Ayodele Solomon Alemayo & Alfred Kimea, 2022. "ARDL Analysis of Remittance and Per Capita Growth Nexus in Oil Dependent Economy: The Nigeria’s Experience," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 15(3), pages 38-51, December.
    • Handle: RePEc:tei:journl:v:15:y:2022:i:3:p:38-51
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    References listed on IDEAS

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    More about this item

    Keywords

    Remittances; Per Capita; ARDL; Growth; Oil Dependent; Nigeria;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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