Remittances and economic growth: What lessons for the CEMAC zone?

Figures & data

Table 1. Description and sources of variables used

Variables	Descriptions	sources
$y$	Real GDP growth rate	WDI
$y^r$	Lagged variable of real GDP growth rate	Authors’ calculation from WDI data
$tfm$	Migrant remittances	IFS
$stab$	Political stability	ICRG
$ouv$	Ratio of the sum of exports and imports to GDP	WDI
$inv$	Ratio of private sector gross fixed capital formation to GDP	WDI
$dep$	Ratio of public expenditure to GDP	WDI
$pop$	Population growth rate	WDI
$dum$	Dummy to capture the effect of the 1994 devaluation. It takes the value 0 before 1994, 1 in 1994 and 0 after 1994.	Construction of the authors

Source : authors

Table 2. IPS and LLC unit root test results

Variables	y	tfm	ouv	inv	dep	pop	stab
Series in level	−5.413***	−7.127***	0.561	−1.5789***	−6.896***	−2.174***	− 2.194
	(0.0000)	(0.0000)	(0.3221)	(0.0000)	(0.0000)	(0.0000)	(0.7851)
IPS
Series in difference			−10.779**				−11.23**
			(0. 0000)				(0. 0000)
Series in level	−6.602***	−6.122***	0.462	−4.574***	−5.231***	−5.775***	−1.863
	(0.0000)	(0.0000)	(0.1729)	(0.0000)	(0.0000)	(0.0000)	(0.1566)
LLC
Series in difference			−9.258**				−10.659**
			(0.0000)				(0.0000)
Conclusion	I(0)	I(0)	I(0)	I(0)	I(0)	I(0)	I(0)

(***) et (**) give the significances at 1 and 5%. The values in brackets are the probabilities.

Source : authors’ calculation

Table 3. Linearity test

Tests	Statistics	Probabilities
Wald test (LMw)	57.615**	0.036
Fisher test (LMf)	5.221**	0.023

Note : (**) reflects the significance at 5%.

Source : authors’ calculation

Table 4. Test of the number of regimes or transition function

Tests	Statistics	Critical probabilities	Number of transition function
Wald test (LMw)	9.646	0.0273	1
Fisher test (LMf)	1.058	0.316	1

Note: Source: authors’ calculation

Table 5. Coefficient estimates for the PSTR and GMM system models

Variables	PSTR	GMM system
tfm (${\beta }_1^0)$	1.972***	2.891**
	(0.964)	(0.682)
tfm (${\beta }_1^1)$	− 2.411***	−1.972***
	(0.487)	(0.826)
y^r	0.439*	0.732**
	(1.719)	(1.824)
ouv	1.817**	1.928**
	(0.652)	(0.938)
Inv	2.136**	1.521**
	(0.911)	(0.634)
dep	−2.301***	−1.432**
	(0.742)	(0.913)
pop	−1.157	−0.329*
	(0.133)	(0.147)
stab	0.048***	0.059**
	(2.349)	(1.874)
dum	−2.21	−1.621
	(0.175)	(0.976)
$\gamma$	52.31	33.14
	1.773	1.524
C	-	1.272**
		(0.585)
LMf nullity	13.49 [0.0000]	-
AR2 (p-value)	-	0.724
Sargan test (p-value)	-	0.618
Observations	174	174

Note : (***), (**) and (*) indicate significance at the 1.5 and 10% levels. Standard deviations are shown in brackets, while the p-value is shown in square brackets.

Source : authors’ calculation

Table A1. Correlation between remittances and economic growth

	y	Tfm
y	1.0000	0.6334*** (10.17)
Tfm	0.6334*** (10.17)	1.0000

Note : (***)gives the significance at 1%. The variables in brackets are the t-students.

Source : authors’ calculation

Table A2. Descriptive statistics

Variables	Mean	Standard deviation	Minimum	Maximum
y	1.88	1.29	−1.481	4.879
Tfm	42.88	23.35	7.84	69.13
Ouv	57.80	26.09	9.71	169.13
Inv	13.32	7.90	−2.83	68.73
Dp	16.78	5.73	6.41	35.84
Pop	1.61	0.92	0.30	3.61
Stab	2.13	1.01	0	6

Source : authors’ calculation

Table A3. Threshold values in the PSTR and GMM system models

Models	PSTR	GMM system
Sign reversal thresholds in %.	52.31	33.14

Note: Source : authors’ calculation