THE IMPACT OF REMITTANCES ON ALBANIAN GDP AND HOUSHOLD INCOME LEVEL
THE IMPACT OF REMITTANCES ON ALBANIAN GDP AND HOUSHOLD INCOME LEVEL
Besije Manushi
Epoka University, Master of Science in Banking and Finance
Address: Tirana, Albania
Email: bmanushi07@epoka.edu.al
Abstract
After the fall of communist regime or from the beginning of the 1990’s, Albania is one of the countries with the large number of emigrants, and it is one of the country that mostly receives remittances which are funds received from migrants working abroad. The aim of this paper is to show the impact of remittances on the Albanian economy and the effect that it has in the GDP and the economic growth. Also, this paper is going to analyze the impact of remittances on poverty level in Albania. Studies show that remittances have a significant impact on the reduction of poverty in the country by directly raising household income and consumption .It is going to be used the regression analysis with the data received from INSTAT and World Bank in order to have a more clear information about the impact of the remittances in Albania economy and on the household income level of people. At the end of the analysis it is going to be discussed the conclusions the importance of remittances, if they play a key role in economy.
Key words: Remittances, Albanian GDP, economic growth, migration.
Introduction
In the recent decades, following the fall of the communist regime, Albania has observed to intense migratory flows.From the end of 1990 till 2009 more than 25 per cent of Albanian population were esitmated to be living abroad(UNECE, 2009).From the beginning of the transition from a centralized to a open market economy Albania has been characterized by rapid increase in the volume of migration with a particular peak in 1997-1998 following the Pyramid Scheme collapse (Azarri and Carletto, 2009) and in 2000. According to Korvoilas in 2005, from 1994 to 2003 Albanin economy has expericned the faster rise in real GDP.
Choosing remittances as a topic,
Besije Manushi
Epoka University, Master of Science in Banking and Finance
Address: Tirana, Albania
Email: bmanushi07@epoka.edu.al
Abstract
After the fall of communist regime or from the beginning of the 1990’s, Albania is one of the countries with the large number of emigrants, and it is one of the country that mostly receives remittances which are funds received from migrants working abroad. The aim of this paper is to show the impact of remittances on the Albanian economy and the effect that it has in the GDP and the economic growth. Also, this paper is going to analyze the impact of remittances on poverty level in Albania. Studies show that remittances have a significant impact on the reduction of poverty in the country by directly raising household income and consumption .It is going to be used the regression analysis with the data received from INSTAT and World Bank in order to have a more clear information about the impact of the remittances in Albania economy and on the household income level of people. At the end of the analysis it is going to be discussed the conclusions the importance of remittances, if they play a key role in economy.
Key words: Remittances, Albanian GDP, economic growth, migration.
Introduction
In the recent decades, following the fall of the communist regime, Albania has observed to intense migratory flows.From the end of 1990 till 2009 more than 25 per cent of Albanian population were esitmated to be living abroad(UNECE, 2009).From the beginning of the transition from a centralized to a open market economy Albania has been characterized by rapid increase in the volume of migration with a particular peak in 1997-1998 following the Pyramid Scheme collapse (Azarri and Carletto, 2009) and in 2000. According to Korvoilas in 2005, from 1994 to 2003 Albanin economy has expericned the faster rise in real GDP.
Choosing remittances as a topic,
References: Bank of Albania (2004) Presentation to IMF, June 2006 Bank of Albania (2005) ,Annual Report 2004,Tirana Bank of Albania (2006), Annual Report 2006,Tirana Bank of Albania, (2001)” “Annual Report 2001, Tirane INSTAT, “Albania in figures”, Tirane, (Qershor 2009) Migration and remittances Factbook 2011.The World Bank, 2010 Migration In Albaniaa country Profile 2008 http://www.iom.hu/PDF/migration_profiles2008/Albania_Profile2008.pdf Remittances (2010) URL :http://www.remittance.in/types-of-remittances.html date of access 15.12.2011 UNDP, “Human Development Report in Albania” http://data.un.org/ World Bank (2006) Italy-Abania Remittance Corridor http://siteresources.worldbank.org/INTAML/Resources/2006_World_Bank_Italy_Albania_Remittance_Corridor.pdf