Determinants of remittances in Southern African Development Community (SADC)
Thesis ( MDF)--Stellenbosch University, 2016.
ENGLISH SUMMARY : This research report investigated determinants of remittances to Southern African Development Community (SADC) countries. Panel data estimation techniques over the period 1990-2014 were used, focusing on 14 SADC countries, excluding South Africa, as the latter is a remittance-sending country within the region. The empirical model that was followed tested the official exchange rate, interest rate, inflation and human capital as determinants of remittance flows to a home country. By means of this research, it was found that human capital is positively linked and statistically significant in determining remittances. The interest rate is significant to determine remittances and thus migrants are interested in investment opportunities in their home countries. Human capital expenditure in SADC is directed towards primary education and thus migrants are mainly low skilled. Should SADC governments invest more towards secondary and tertiary education, the high volume of youthful SADC labour could have access to higher incomes in host countries that offer higher-skilled employment and possibly remit more towards investment purposes.
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