Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper adds international migration and remittances into the IMF’s Flexible System of Global Models (FSGM). FSGM is a global general equilibrium model with endogenous primary commodity markets. A method to estimate the structural dynamics of major remitter regions is proposed. The dynamics of remittances and migration in FSGM are calibrated to be consistent with the main stylized facts of the empirical estimates. Structural disturbances pertinent to current global remittance flows are examined. These disturbances include disruptions to oil supply, output variation in Europe and the United States, labor nationalization policies in Saudi Arabia, and a global reduction in the cost to remit. The multilateral framework illustrates how remittance inflows need not originate from the region with the underlying economic disturbance but can arise from third party remitter regions affected by global commodity markets. The results also illustrate that the correlation of remittance inflows and the real GDP of labor-exporting economies can be either positively or negatively correlated. The evidence suggests that the behavioral incentive to migrate and remit cannot be deduced from correlations of real GDP and remittance inflows.

Capital movements. --- Economic assistance. --- Economic development. --- Development, Economic --- Economic growth --- Growth, Economic --- Economic policy --- Economics --- Statics and dynamics (Social sciences) --- Development economics --- Resource curse --- Economic aid --- Foreign aid program --- Foreign assistance --- Grants-in-aid, International --- International economic assistance --- International grants-in-aid --- International economic relations --- Conditionality (International relations) --- Capital flight --- Capital flows --- Capital inflow --- Capital outflow --- Flight of capital --- Flow of capital --- Movements of capital --- Balance of payments --- Foreign exchange --- International finance --- Investments: Energy --- Exports and Imports --- Labor --- Macroeconomics --- International Migration --- Remittances --- Open Economy Macroeconomics --- Energy: Demand and Supply --- Prices --- Labor Force and Employment, Size, and Structure --- Energy: General --- Labor Economics: General --- International economics --- Labour --- income economics --- Investment & securities --- Oil prices --- Foreign labor --- Oil --- Commodities --- Labor market --- Petroleum industry and trade --- Labor economics --- Saudi Arabia

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Structural budget-balance rules with countercyclical elements appear well suited to stabilize the macroeconomic volatility of oil-exporting countries and have been used successfully by other commodity exporters. Using a global DSGE model, the efficient design of such rules is found to depend on the source of oil price fluctuations and the oil exporters’ structural characteristics. The output-inflation tradeoff is of particular concern for oil exporters relative to non-oil exporters due to the pass through of oil prices into headline inflation. Fiscal rules are best when coordinated with inflation targeting monetary policy, but are still desirable for fixed exchange rate regimes.

Petroleum industry and trade --- Fiscal policy. --- Energy industries --- Oil industries --- Tax policy --- Taxation --- Economic policy --- Finance, Public --- Economic aspects. --- Government policy --- Investments: Energy --- Inflation --- Macroeconomics --- Public Finance --- Fiscal Policy --- Comparative or Joint Analysis of Fiscal and Monetary Policy --- Stabilization --- Treasury Policy --- Open Economy Macroeconomics --- National Deficit Surplus --- Energy and the Macroeconomy --- Energy: Government Policy --- Energy: General --- Energy: Demand and Supply --- Prices --- Price Level --- Deflation --- Investment & securities --- Oil --- Oil prices --- Fiscal rules --- Fiscal policy --- Commodities --- Chile