Remittances led growth in West Africa Monetary Zone (WAMZ)

This study explores the significance of remittances on the economic growth of six (6) WAMZ Countries within a non-linear augmented conventional neoclassical growth framework using an unbalanced panel data spanning from 1970 to 2011. The main contribution of this paper is the use of heterogenous panel cointegration method to estimate remittances-growth nexus in the WAMZ region. The paper also considers two prominent periods of policy restructuring within the member countries in order to confirm the choice of the heterogenous panel cointegration method. Our findings indicate that remittances have a positive and significant effect on the growth of WAMZ Countries. We found that a sound macroeconomic policy is sine qua non for the effective contribution of remittances to sustainable growth. Also, we found that the incessant socio-political crisis evident in the WAMZ region has crippled the effectiveness of remittances in these countries.