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| Title: | An Empirical Analysis of the Effect of International Remittances on Income Inequality in Nigeria |
| Author(s): | AMADI S.N., MOMODU A. A., ONYEMA J. I. & OCHEJE F. E |
| Abstract: | This study empirically examined the effect of international remittances on income inequality in Nigeria from 1990 to 2023. More importantly, the study proxied international remittances by inward remittance, outward remittance, official development assistance and technical cooperation grant while income inequality was proxied by Gini coefficient. The study made use of annual time series data which were mainly sourced from Central Bank of Nigeria (CBN) statistical bulletin, the National Bureau of Statistics, the International Monetary Fund (IMF) and the World Development Indicators of World Bank. The major techniques of data analysis adopted were ADF unit root test, bounds cointegration test and ARDL approach. The key findings revealed that inward remittance, official development assistance and technical cooperation grant have negative and significant effect on Gini coefficient, in Nigeria both in the short and long run. Also, outward remittance has a positive and significant effect on Gini coefficient, in Nigeria both in the short and long run. Based on the findings, the study therefore concludes that international remittances play a significant positive role in promoting reducing income inequality in Nigeria. It was recommended among others that Nigerian government should strengthen policies that channel remittance inflows into productive investments such as small and medium enterprises (SMEs), agriculture, housing, and education. This can be achieved by: Expanding access to financial services in rural areas through mobile banking and microfinance institutions, offering matching grant schemes and tax incentives for diaspora-funded investments as well as partnering with banks to develop diaspora bonds or remittance-backed investment products. |
| Keywords: | Inward remittance, outward remittance, official development assistance, technical corpor |
| Journal: | Journal of World Economics and Financial Report Vol 2 No 1 |
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