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Remittance Inflows and State-Dependent Monetary Policy Transmission in Developing Countries

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  • Machasio, Immaculate
  • Tillmann, Peter

Abstract

Remittance inflows from overseas workers are an important source of foreign funding for developing and emerging economies. This paper estimates nonlinear (smooth-transition) local projections to study the effectiveness of monetary policy under different remittance inflows regimes. We show that for Kenya, Mexico, Colombia and the Philippines monetary policy has a smaller effect under strong inflows of remittances.

Suggested Citation

  • Machasio, Immaculate & Tillmann, Peter, 2017. "Remittance Inflows and State-Dependent Monetary Policy Transmission in Developing Countries," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168137, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc17:168137
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    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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