The Role of Workers' Remittances and Their Interaction with Physical and Human Capital in Stimulating Economic Growth in Jordan (1979-2015)
The objectives of this research are diverse. First, determine the impact of workers’ remittances on Jordan’s economic growth during the period. The second goal in the second and third models is to determine the role of remittance in economic growth if we allow the interaction between workers’ remittances and human capital and physical capital, according to the theory of endogenous growth. For this purpose, time series analysis (cointegration tests and vector error correction model) is used. Corresponding it is found that all the series representing the variables are stationary at the first difference. The results also show that there are two cointegration vectors relating the variables. Therefore, the model was estimated using vector error correction model, which showed a long-term relationship between economic growth and explanatory variables. The estimate according to the first model showed that there is a significant positive effect for each of the workers' remittances, the variables of trade openness, financial policy, and the development of the financial system. while the physical and human capital variables have significance negative impact on growth. In the second and third model, it agreed with the endogenous growth theory, that if workers 'remittances are directed towards supporting physical and human capital, the impact of workers' remittances on economic growth will increase.
Eyad Moufaq Alkousini,
The Role of Workers' Remittances and Their Interaction with Physical and Human Capital in Stimulating Economic Growth in Jordan (1979-2015), International Journal of Business and Economics Research.
Vol. 9, No. 5,
2020, pp. 364-373.
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