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The ambiguous role of remittances in West African countries facing climate variability

Published online by Cambridge University Press:  09 July 2014

Cécile Couharde  and
Rémi Generoso
Cécile Couharde
Affiliation:
EconomiX-CNRS, University of Paris Ouest Nanterre La Défense., 200, avenue de la République, 92001 Nanterre, France. E-mail: cecile.couharde@u-paris10.fr
Rémi Generoso
Affiliation:
CEMOTEV, University of Versailles-Saint-Quentin, France. E-mail: rgeneros@ens.uvsq.fr
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Abstract

We investigate the consequences of remittances inflows on the macroeconomic performance of West African countries over the 1985–2007 period. We take into account the exposure of those countries to climate variability by estimating a PCHVAR model which allows heterogeneity between countries’ responses to rainfall shocks. Our results show that the impact of remittances on macroeconomic performance is highly sensitive to those shocks. In particular, when drought conditions prevail, remittances no longer exert any short-term spillover effects on growth and may increase a situation of economic dependence, by spurring agricultural imports.

Type
Research Article
Information
Environment and Development Economics , Volume 20 , Special Issue 4: Climate Change Mitigation and Adaptation in Developing and Transition Countries , August 2015 , pp. 493 - 515
Copyright
Copyright © Cambridge University Press 2014 

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