PDF_logo Impact of Remittances on Poverty Reduction: Evidence from Bangladesh

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Impact of Remittances on Poverty Reduction: Evidence from Bangladesh

Paper No:58

Author:Nahid Akhter



Bangladesh is one of the major suppliers of migrant workers especially to the Middle East, and the flow of remittances has increased from $2.8 billion in 2002 to $13.52 billion in 2017, which is more than 5 per cent of the country’s GDP. This article investigates the impact of remittances on poverty. The empirical analysis reveals that there is a significant relationship between growth in remittances and different outcome variables in the economy with positive impact on poverty, household income and financial inclusion. The results indicate that both internal and international remittances have positive impact on poverty alleviation; and these results are statistically significant. International migration and remittance supplies are important pathways out of poverty for the poor households. Considering the impact of remittances on poverty and economic outcomes, appropriate technical and vocational trainings are needed to utilise the full potential of the migrant workers and maximise the contributions of remittances to the domestic economy.

Keywords: Remittances, Poverty, Savings, Income, Bangladesh.

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