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171Do Workers' Remittances Induce Inflation? The Case of Vietnam, 1996-2012*
To NGOC HUNG, Ph.D.
Associate Professor, Director of Banking Academy of Vietnam, the State Bank of Vietnam hungtn@hvnh.edu.vn
Nguyen KHAC MINH, Ph.D.
Professor, National Economics University, Hanoi, Vietnam khacminh@gmail.com
Abstract. This paper seeks to examine the impact of remittances on inflation in Vietnam during 1996-2012. Using the vector autoregressive model (VAR), we show that remittance causes inflation indirectly through increasing money supply. We provide empirical evidence indicating that remittance inflows could have a significant impact on money supply with a one-lag quarter due to the failure of the State Bank of Vietnam in neutralizing the intervention effects on monetary base during this period. Secondly, money supply is found to accelerate inflation with a two-quarter lag in Vietnam. The paper, therefore, suggests a transmission mechanism of remittance to inflation in the context of a fixed exchange rate regime.
Аннотация. В статье анализируется влияние международных денежных переводов (ремиссий) на инфляцию во Вьетнаме в период 1996-2012 гг. С использованием вектора авторегрессии (VAR) авторы показывают, что ремиссии косвенно приводят к инфляции за счет увеличения денежной массы. Приведены эмпирические сведения о том, что приток ремиссий может оказать существенное влияние на денежную массу с задержкой на один квартал из-за провала Государственного банка Вьетнама в нейтрализации воздействия вмешательств на денежную базу в течение этого периода. Кроме этого, во Вьетнаме денежная масса, в свою очередь, оказывает влияние на инфляцию с задержкой на два квартала. Таким образом, в статье предложен механизм передачи от ремиссий к инфляции в контексте режима фиксированного обменного курса.
Key words: worker's remittance, inflation, fixed exchange rate regime, money supply, Vietnam.
1. INTRODUCTION
The paper aims to examine the effects of remittances on inflation in Vietnam during 1996-2012 by using the vector autoregressive model (VAR). In recent years, worker's remittance inflows into Vietnam have increased significantly and seemed to surpass other capital inflows such as foreign direct investment and foreign portfolio investment (Appendix Figure 1). They are expected to have positive effects on the economy such as economic growth, higher living standard, poverty reduction and hunger eradication. However, they seem to result in negative issues including high inflation pressure.
Our paper contributes in literature review in some new ways: firstly, the paper suggests transmission mechanism of worker's remittance in the fixed exchange rate regime that is implemented by most
developing countries like Vietnam. Secondly, unlike previous studies focusing on microeconomic impact of remittance, this is the first research to examine effects of remittance on inflation in Vietnam, specifically large remittances flows leading to a high inflation. It, therefore, suggests policy recommendations to attract more remittance while reducing its negative impacts on the economy. Moreover, the estimated results were found to be appropriate for forecasting inflation in Vietnam in short-term.
There are three major findings. Firstly, remittance inflows could have a significant impact on money supply with a lag of one quarter due to the failure of the State Bank of Vietnam in neutralizing the intervention effects on monetary base during this period. Secondly, money supply is found to accelerate inflation with a two-quarter lag in Vietnam during 19962012. The paper, therefore, suggests a transmission
* Стимулируют ли инфляцию денежные переводы граждан, работающих за границей? (на примере Вьетнама 1996-2012 гг.).
mechanism of remittance to inflation in the context of a fixed exchange rate regime (e.g. remittances lead to a high level of money supply after one quarter, then it results in high inflation rate with a lag of two quarters). The paper also reveals empirical evidence that inflation expectations or inflationary mentality can be considered as an important explanation of inflation in Vietnam.
These findings contribute to literature on remittance's impacts on inflation under the pegged exchange rate regime. Moreover, it presents important policy implications for the authorities of developing countries who wish to attract more worker's remittance inflows like Vietnam. Accordingly, it is important that the country should shift its exchange rate regime from a fixed to a floating to lessen negative effects of remittance upon inflation.
The rest of paper is structured as follows: section 2 discusses literature review on impacts of worker's remittance on inflation. Section 3 presents the theoretical framework employed to estimate impacts of worker's remittance on inflation. Section 4 analyses determinants of inflation in Vietnam, focusing on remittance as an important factor causing inflation during 1996-2012. Section 5 presents a summary and conclusion. Finally, the Appendix provides summary statistics on the variables used in the empirical study, and presents the developments of capital flows including remittance in Vietnam during 1996-2012.
2. LITERATURE REVIEW
Remittance is one of capital flows that play very important role in economic development, especially for developing countries. From a microeconomic perspective, previous studies found empirical evidence that remittance inflows promote economic development by providing funds that recipients can spend on education, health care, business investment (Adams Jr., 2006; Yang and Martinez, 2006; McKenzie, 2006, Bracking and Sachikonye, 2006; Attzs, 2008). Regarding macroeconomic aspect, it can boost aggregate demand and thereby GDP as well as spur economic growth. Remittance, however, may also cause negative impacts such as high inflation, income inequality, and other social issues.
The impacts of remittances on inflation in the host country can be analyzed from three different aspects including domestic currency appreciation, large money supply, and balance of payments (Narayan et al., 2011). The first could be explained based on the Salter (1959), Swan (1960), Corden (1960) and Dornbusch (1974) paradigm. This model could be considered as the theoretical underpinning to test empirically the
incidence of capital inflows (e.g. FDI, remittances) on the real effective exchange rate (REER) as well as the price level in emerging economies. In other words, remittances flows will have spending effects, resulting in high domestic prices and domestic currency appreciation.
Another way to explain the relationship between remittances and inflation is using a micro-founded dynamic stochastic general equilibrium model suggested by Acosta et al. (2007). They argued that large remittance flows would lead to an increase in the household income, and then a decrease in the labor supply (people receiving remittances do not want to find a job). A lower labor supply will result in higher wage, contributing higher production costs. Both the real exchange rate and the ratio of tradable to non-tradable output induce high spending and resource movement, and lead to an increase in inflation.
More importantly, impacts of an increase in remittances on inflation and nominal money supply will depend on the country's exchange rate regime. Reinhart and Rogoff (2004) argued that under a fixed exchange rate regime, the remittances temporarily increase the rate of inflation and the nominal money supply by moving resources from the tradable to non-tradable sector. This result is consistent with findings of Amuedo-Dorantes and Pozo (2004), Bourdet and Falck (2006), Caceres and Saca (2006), Lopez et al. (2007), and Ball et al. (2009). In contrast, under a flexible regime, the remittances temporarily decrease the rate of inflation but do not have any impact on the nominal money supply (Ball et al., 2009).
The different impacts of remittances on inflation under different exchange rate regimes can also be explained from the point of view of the balance of payments and international reserves accumulation, as follows. An increase in remittances leads to a rise in supply of foreign currency so that the domestic currency revaluates. If country follows a fixed exchange rate regime, the central bank should intervene by buying foreign currency in the foreign exchange market. Failure of central banks to sterilize fully the increase in international reserves will lead to an increase in the monetary base (Bugamelli and Paterno, 2009). Under the floating exchange rate regimes, central banks do not intervene so that monetary base and inflation may not be affected.
The remittances into Vietnam have increased manifold in recent years and are expected to have multitude of effects in the economy. It, therefore, is a very interesting topic that has drawn attention of policy makers as well as researchers. Studies on remittances into Vietnam focused mainly on their impacts on the economy such as remittances and house-
hold income (Pfau and Long, 2006; Nguyen Duc Thanh, 2007); remittances and economic growth (Khaled Sakr, 2006; Do Thi Duc Minh, 2007; Nguyen Minh Thao, 2009). This paper, therefore, could be the first research on impacts of remittances on inflation in Vietnam. Our findings will contribute to literature on empirical as well as suggest policy recommendations for Vietnam to reduce negative effects of remittances on the economy.
3. THEORETICAL FRAMEWORK
The impact of remittances on inflation in the country can use macroeconometric models for policy analysis. Before the 1980s, simultaneous equation system was used widely in forecasting and analyzing macroeconomic variables. The macroeconometric models had been criticized by Lucas, since the assumptions of invariant behavioral equations were shown to be inconsistent with dynamic maximizing behavior (Lucas, 1976)
Sims (1980) changes the focus of the society of econometricians. He argued that all macroeconomic variables are endogenous in essence — they are interrelated. Money supply, for example, is controlled by the Central Bank, but money-related decisions made by the Bank are based on the state of the economy, which consists of other macroeconomic variables including inflation, unemployment and so on. Therefore, he proposed a symmetric model in which all variables play an equal role, and all are endogenous — the vector autoregressive model (VAR). The VAR models may not satisfy Lucas's criteria for policy intervention but are useful to find the impact of remittances on inflation.
In general, the unrestricted VARs are on reduced form, and are therefore uninterruptible without "reference" to theoretical economic structures. Suppose that Yt is a (nxl) vector of macroeconomic variable whose dynamic behavior is governed by a finite structural model.
B0Yt= y+B,YM+ B2 Yt-2+... + BYt-p+ut a)
where y is a constant, B. is a (nxn) matrix of coefficient, and ut is a (nxl) vector of white noise structural disturbances, with covariance matrix Z. A reduced form of Yt can be written as:
Y=5+ a^ a2Yt_2+... + a Yt_p+ et (2a)
or
a (L) Zt = 5 +et (2b)
where 8 = B0 \ , ai = B0lB,, and et = B^ut is white noise process, with nonsingular covariance matrix Q. a (L) = I- a jL -a 2L2... a pLp. From the reduced form to the structural model, a set of identifying restrictions must be imposed. It is common to assume that the covariance matrix for ut (Z) is diagonal, while B0 has unity on its main diagonal but elsewhere is unrestricted. This implies that each number of Yt is assigned its own structural equation, which ensures that the shocks can be given an economic interpretation.
The a .s and Q can be estimated by applying OLS to the reduced form (2). However, if the B.s are unrestricted, we cannot estimate B0 as the a .s contain pn2 known elements and there are (p+1) n2 unknown elements in the Bs. Instead one solves for B„from:
0
n = cov^) = co v(B0lut) = B;1^ (B"1)' (3)
There are n (n+1) /2 distinct covariances in Q. The assumption is that Z is diagonal and contains n elements. It means that n (n-1) /2 restrictions should be needed to identify the system. Assuming Yt is a covariance stationary vector, (2b) can be written as:
Y = ^ (L) et (4)
where ^ (L) = a (L) and ^ 0=I. (4) is not identified. To identify the system, we choose any nonsingular matrix P, such that the positive definite symmetric matrix Q = PP'. Rewriting (4) gives:
ro ro
Y = =Z Cs,_( (5)
i-0 i-0
where C = (b P and s =P-1e,
i i t t.
Table 1. ADF Unit root test for three variables in VAR model.
Variables Critical values ADF statistics Decision
1% 5% 10%
gCPI -3.5600 -2.9176 -2.5966 -2.9834"" Reject Ho
gM2 -3.5420 -2.9100 -2.5926 -6.1084""" Reject Ho
gRE -3.5440 -2.9108 -2.5930 -7.7660""" Reject Ho
Note: ***, **, * indicates that the statistic is significant at the 1 percent, 5 and 10 percent level of significance respectively.
Table 2. VAR lag order selection criteria.
Lag LogL LR FPE AIC SC HQ
0 208.2835 NA 2.14e-07 -6.842784 -6.738067* -6.801823
1 224.2560 29.81536 1.70e-07 -7.075201 -6.656332 -6.911358
2 239.3123 26.59941 1.39e-07 -7.277077 -6.544056 -6.990352*
3 242.2111 4.831290 1.72e-07 -7.073703 -6.026530 -6.664096
4 257.8514 24.50311* 1.39e-07* -7.295045* -5.933721 -6.762557
5 263.4774 8.251566 1.59e-07 -7.182581 -5.507105 -6.527210
Table 3. Stability test.
Root Modulus
0.637734-0.561589Í 0.849757
0.637734 + 0.561589Í 0.849757
0.084072-0.779227Í 0.783749
0.084072 + 0.779227Í 0.783749
0.742837 0.742837
-0.312148-0.584861Í 0.662947
-0.312148 + 0.584861Í 0.662947
-0.446118-0.365315Í 0.576608
-0.446118 + 0.365315Í 0.576608
-0.485741 0.485741
0.226392-0.423565Í 0.480272
0.226392 + 0.423565Í 0.480272
No root lies outside the unit circle.
VAR satisfies the stability condition.
One of applied VAR model is to establish the impulse response function. In terms of notation above, the matrix C contains the effect of a unit increase each of the variable's innovations at time t on all variable in Y
at time t+s: Cs =-^
a a,
The VAR model specified here focuses on three variables: inflation (CPI), money supply and worker's remittances. These variables are minimum of variables that are necessary to identify the structural disturbances.
We define Yt as a vector of stationary macroeconomic variables Yt = (gcpit, gm2t gret) where gcpit, is the CPI growth rate, gm2 is the growth rate of money supply and gret is the growth rate of worker's remittances (RE). A reduced form of Yt can be modeled as:
p 1 P 2 P 3 gcpit =Oi + Z $ygcpit_j + Z pljgm2t-j + Z pljgret-j + eit
j=i j=i j=i p 1 p 2 p 3
gm2t =^2 + Z p2jg^h-j + Z p2jgm2t-j + Z p2jgret-j + e2t j=1 j=1 j=1
P 1 P 2 P 3
gret = CL3 + Z p3 jgm - j + Z p3 jgm2t- j + Z pygret- j + e3t j=1 j=1 j=1
Inverse Roots of AR Characteristic Polynomial
1.51.00.50.0-0.5-1.0-1.5-1.5 -1.0 -0.5 0.0 0.5 1.0 1.5
• • • • • 1
1 • • •
T i i i r
Figure 1. Stability test - Inverse roots of AR characteristics polynomial.
To go from the reduced form to the structural model, a set of identifying restrictions must be imposed. As all variables defined in Yt are stationary, Yt is a covariance stationary vector process.
4. ASSESSING IMPACTS OF REMITTANCE ON INFLATION IN VIETNAM DURING 1996-2012
4.1. DATA DESCRIPTION
In order to analyse impacts of remittance on inflation, we use vector autoregressive (VAR) model suggested in Ball et al. (2009) for three variables1. They are CPI (Consumer Price Index), M2 (Money supply), and RE (worker's remittances). The main sources of data come from the General Statistics Office (GSO) and International Financial Statistics (IMF) for period of 199601-201203. Data are collected on quarterly basis and seasonally adjusted by census X12. They are taken in the form of growth. Statistics for variables is summarized in Appendix table 1.
4.2. SELECTING AN APPROPRIATE MODEL 4.2.1. Unit root tests
In order to examine impacts of remittances on inflation in Vietnam by employing VAR model, we should
1 Unlike model suggested by Ball et al. (2009), exchange rate is eliminated from our model because Vietnam followed the fixed exchange rate regime during the period (Takagi and Pham, 2011). Moreover, exchange rate channel was not effective in the transmission mechanism of monetary policy in the case of Vietnam (Pham, 2013).
do ADF unit root test. As shown in Table 1, all variables are taken in the form of growth, and are found to be stationary at 5 percent level of significance. They are I (0).
4.2.2. Selecting lag length of model
Lag length of the model is 4 periods, which is selected based on five criteria including LR, FPE (Final prediction error), AIC (Akaike information criterion), SC (Schwarz information criterion), HO (Hannan-Ouinn information criterion) (Table 2).
4.2.3. Diagnosis tests
In order to check the appropriateness of the estimated VAR model, we estimate AR roots or inverse roots of the characteristic AR polynomial. Table 3 and Fugure 1 show that the estimated VAR is stable because all roots have modulus less than one and lie inside the unit circle.
Moreover, we did the Portmanteau Tests for autocorrelations. Portmanteau Test computes the multivariate Box-Pierce/Ljung-Box Q-statistics for residual serial correlation up to the specified order (Table 4). We found that with different lags, p-values of Q-statistics are greater than 5 percent. We accept the null hypothesis of no serial correlation up to lag 5.
In order to test for a range of specifications of het-eroscedasticity in the residuals of VAR equation, we employ White Test. Results of White's Heteroscedas-ticity Test argued that we accepted null hypothesis of homoscedasticity at one percent level of significance (Table 5).
Table 4. VAR residual serial correlation LM tests.
VAR Residual Serial Correlation LM Tests
Null Hypothesis: no serial correlation at lag order h
Date: 03/22/13 Time: 17:28
Sample: 199602 201103
Included observations: 58
Lags LM-Stat Prob
1 9.319912 0.4083
2 4.263225 0.8932
3 10.86021 0.2854
4 16.62412 0.0549
5 5.323031 0.8053
Table 5. VAR residual heteroscedasticity tests.
VAR Residual Heteroscedasticity Tests: No Cross Terms (only levels and squares)
Joint test:
Chi-sq Df Prob.
147.1166 160 0.7590
4.3. ESTIMATING THE MODEL
The above residual tests showed that VAR model for three variables (gcpi, gm2, and gre) are good for estimating impacts of worker's remittance on inflation as well as forecasting inflation rate in short-term. After carrying out lag exclusion tests for each lag in the VAR model, we obtained the appropriate system of equations as follows:
gcpi(t) = 0.853gcpzt-1 - 0.02gm2t-1 - 0.425gcpit_2 + 0.071gm2t-2 - 0.116gcpit_4
se (0.135) (0.05) (0.136) (0.041) (0.108)
gm2(t) = 0.029 - 0.715gcpit-1 + 0.023gret-1 + 0.774gcpit-3 - 0.442gcpit-4 + 0.232gmt_4 (5)
se (0.224) (0.013) (0..285) (0.301) (0.095)
gre(t) = - 2.099gcpit-1 - 0.246gret-1 - 0.936gm2t-2 - 0.276gr et-2 + 3.018gm2t-4
se (1.75) (0.114) (0.65) (0.118) (0.629)
Based on system of equations (5) derived from the VAR model of estimating impacts of worker's remittance in Vietnam for period 1996-2012, there are some main findings as follows:
First, one percent increase in worker remittances leads to 0.023 percent significant increase in money supply (M2) after one quarter in the case of Vietnam during 1996-2012. Moreover, the impulse response function derived from the VAR model provides similar finding (Appendix Figure 3). This finding is consistent with those of Amuedo-Dorantes and Pozo (2004), Bourdet and Falck (2006), Lopez, Molina and Bussolo (2007), Ball et al. (2009).
In case of Vietnam, this phenomenon could be a result the failure of the State Bank of Vietnam to neutralize the intervention effects on monetary base during this period. For example, after joining the WTO in 2007, Vietnam experienced appreciation pressure amid buoyant capital inflows (e.g. foreign direct investments, foreign portfolio investment, and remittances) (Appendix, Figure 1). The SBV intervened in the inter-bank market to buy more than estimated US$9 billion during 2007 to ease appreciation pressure on the Vietnamese dong2, with the result that the balance of foreign exchange reserves reached a record US$23.5 billion at the end of the year. At the same time, it attempted to sterilize the impact of intervention by selling Treasury bonds, and by increasing reserve requirements on dong deposits (from 5 to 10, and further to 11 percent) as well as on foreign currency deposits (from 8 to 10, and further to 11 percent). In March 2008, the central bank also sold 20300 billion dong in one-year "compulsory" Treasury bills (i.e., government bills commercial banks are "required" to purchase)3 to 41 commercial banks at the coupon rate of 7.8 percent. Despite these efforts, money
2 The Vietnam's de facto exchange rate regime was fixed or pegged during 1990-2010 according to the IMF report and Takagi and Pham (2011).
3 41 commercial banks are required to purchase these bills at a coupon rate below the prevailing market rate.
Table 7. Real and forecast inflation in Vietnam.
Table 6. Forecast inflation in Vietnam, 201104-201202.
gCPI
Time forecast lower CI upper CI +/-
2011 Q4 -0.0164 -0.0493 0.0166 0.0329
2012 Q1 -0.0191 -0.0620 0.0237 0.0429
2012 Q2 -0.0156 -0.0595 0.0283 0.0439
gM2
Time forecast lower CI upperCI +/-
2011 Q4 0.0562 -0.0125 0.1250 0.0688
2012 Q1 0.0573 -0.0145 0.1291 0.0718
2012 Q2 0.0535 -0.0205 0.1274 0.0740
Time forecast lower CI upper CI +/-
2011 Q4 0.1354 -0.4462 0.7170 0.5816
2012 Q1 -0.2943 -0.9002 0.3117 0.6060
2012 02 0.0949 -0.5303 0.7202 0.6252
CPI (Real) CPI (Forecast) Error Error square
2011 04 116.44 120.412312 0.039723 0.001577926
2012 01 114.15 118.1124368 0.039624 0.001570091
Square root of sum of error square 0.0561
supply (M2) increased by 47.2 percent compared with 2006 (Takagi and Pham, 2011).
Secondly, equations (5) reveal empirical evidence that money supply has significant impact on inflation in Vietnam with a lag of two quarters. For example, one percent increase in money supply will result in 0.071 percent significant increase in inflation after two periods. In other words, an increase in money supply leads to a high inflation rate in spite of lagged influences. This finding is consistent with conventional monetary theory as well as findings of Chu Khanh Lan (2012), To Ngoc Hung (2012).
Thirdly, worker's remittance had indirect effect on inflation rate via money supply in the case of Vietnam. According to equation system (5), remittance has directly positive impact on money supply with lag of one period, and then money supply will lead to inflation in Vietnam after two quarters. It, therefore, could be considered as the transmission mechanism of worker's remittance to inflation in Vietnam for period of 1996-2012. The transmission resulted from the fact that Vietnam followed the fixed exchange rate regime in order to stabilize macroeconomic environment.
Fourthly, this VAR model also provides empirical evidence that inflation expectations can be considered as important explanation of inflation in Viet-
nam in the sense that one percent increase in inflation rate at time t will lead to an increase of 0.853% in inflation at time (t+1). This finding is consistent with those of Nguyen Thi Kim Thanh (2008), Chu Khanh Lan (2012), To Ngoc Hung (2012). The finding seems to reflect inflationary mentality in Vietnam during this period. The term "inflationary mentality" could be explained as follows. There is a fact that if inflation increased significantly, residents expected commodity prices to continue to increase in future. Therefore, suppliers tend to quote a new price for their commodities higher than usual. This phenomenon could result from an unsound monetary policy and depreciation of the Vietnamese dong during 1996-2012.
4.4. FORECASTING INFLATION RATE IN VIETNAM
One of advantages of the VAR model is that it could be employed to analyze and forecast macroeconomic variables. The above diagnosis checking tests argued that the estimated model is a good one. It, therefore, could be used to forecast inflation rate in Vietnam in short-term.
In order to forecast inflation in Vietnam, we employ system of equations (5) to estimate inflation for period 201104-201202 (Table 6). Then, we
take gaps (errors) between real CPI and forecast CPI at the same time. As we can see in Table 7, errors are not greater than 4 percent, and square root of sum of error square is 5.61 percent. Therefore, the model for examination of impacts of remittance on inflation could be good for forecasting inflation in short-term.
5. CONCLUDING REMARKS
The paper examines the effects of worker's remittance inflows on inflation in Vietnam during 1996-2012. There are three major findings. Firstly, remittance inflows could have a significant impact on money supply with a lag of one quarter due to the failure of the State Bank of Vietnam in neutralizing the intervention effects on monetary base during this period. Secondly, money supply is found to accelerate inflation with two-quarter lag in Vietnam during 1996-2010. The paper, therefore, suggests a transmission mechanism of remittance to inflation in the context of a fixed exchange rate regime (specifically, remittances lead to a high level of money supply, resulting in high inflation rate).
These findings contribute to literature on remittance's impacts on inflation under the pegged regime. Moreover, they present important policy implications for the authorities of developing countries who wish to attract more remittance like Vietnam. Accordingly, it is important that the country should shift its exchange rate regime from a fixed to a floating to lessen negative effects of remittance upon inflation.
Another important finding is that inflation expectations can be considered as important explanation of inflation in Vietnam in the sense that an increase in inflation rate at time t will lead to an increase of inflation at time (t+1). This finding reflects inflationary mentality in Vietnam during this period. It suggests policy implications for monetary authorities of developing countries, which suffer high inflation like Vietnam. Accordingly, the monetary authorities should eliminate inflationary mentality by following a sound monetary policy in order to enhance residents' belief in value of domestic currency.
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Appendix
Appendix Table 1. Summary Statistics for Three Variables in the VAR Model.
GCPI GM2 GER
Mean -4.20E-05 0.067701 0.009872
Median -0.00096 0.059912 0.00241
Maximum 0.062065 0.355664 0.093545
Minimum -0.07207 -)0.00366 -0.00956
Std. Dev. 0.027214 0.048191 0.019001
Skewness -0.39852 3.313459 2.516102
Kurtosis 4.049143 20.41046 9.255461
Observations 66 66 66
Source: Ministry of Planning and Investment, the State Bank of Vietnam. Appendix Figure 1. Developments of FDI, ODA and Worker's Remittance Inflows in Vietnam, 1995-2012 (in millions of USD).
Source: Database of World Bank Appendix Figure 2. Top 20 countries receiving worker's remittances in 2012 (in millions of USD).
Response of GM2 to GCPI
Response to Cholesky One S.D. Innovations ± 2 S.E.
Response of GM2 to GM2
23456789 10
Response of GM2 to GRE
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2 3 4 5 6 7 8 9 10
Response of GCPI to GCPI
Response of GCPI to GM2
Response of GCPI to GRE
.01 -.00
23456789 10
.01 -.00
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2 3 4 5 6 7 8 9 10
Response of GRE to GCPI
Response of GRE to GM2
Response of GRE to GRE
123456789 10
1 2 3 4 5 6 7 8 9 10
1 2 3 4 5 6 7 8 9 10
Appendix Figure 3. Response of GM2, GCPI, and GRE to Structural One Standard Deviation Innovations to GM2, GCPI, and GRE.
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08
08
04
00
00
00
03
03
03
02
-.1 -
-.2
