The Responsiveness of Remittances to the Oil Price: The Case of the GCC

24 Pages Posted: 21 Jul 2009

See all articles by George Naufal

George Naufal

Texas A&M University; IZA Institute of Labor Economics

Ali A. Termos

American University of Sharjah

Abstract

We investigate the responsiveness of remittances from the Gulf Cooperation Council (GCC) countries to the changes in the price of crude oil. Most of the GCC countries rank in the top 20 remitting countries in the world. We find that oil price elasticity of remittances is around 0.4. While most studies have examined the impact of remittances on the real economic activities in the receiving countries, this study emphasises the impact of remittances on the remitting countries. We examine various policy implications with regard to macroeconomic shocks, monetary policy and fiscal policy of the GCC countries.

Keywords: elasticity, remittances, oil price, GCC

JEL Classification: F24, P22, N15

Suggested Citation

Naufal, George Sami and Termos, Ali A., The Responsiveness of Remittances to the Oil Price: The Case of the GCC. Available at SSRN: https://ssrn.com/abstract=1434611 or http://dx.doi.org/10.2139/ssrn.1434611

George Sami Naufal (Contact Author)

Texas A&M University ( email )

Public Policy Research Institute
4476 TAMU
College Station, TX 77843
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Ali A. Termos

American University of Sharjah ( email )

P.O. Box 26666
Sharjah
United Arab Emirates

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