Random Effects Model

The results (table1) from panel analysis using fixed and random effects model, provide similar outcomes. Random effects model is the most appropriate in this study judged by Hausman test. The scrutiny of the findings reveals several facts. The macroeconomic situation of the home countries, number of migrants, official exchange rate of the home countries, political stability index, and four among seven host countries are found to be the factors effecting on the flow of migrant workers’ remittances. However, some factors contain positive effects, while other factors contain negative effects on the workers’ remittance inflows.
The GDP per capita of the origin country (LYKH) is significant with the negative sign. This indicates that the migrant

It elucidates that the migrant workers possibly delay or reduce the remittance to their home countries to avoid losing in exchange rate during the currency appreciation which denotes strong economic condition of home countries. On the contrary, they might remit more to profit from exchange rate depreciation which indicates adverse economic situation of home country. The result is in line with the papers of Singh et al. (2011) and van Eyden et al. (2011). Furthermore, political stability (PSI) is significantly negative effect on the remittances. It implies the better political condition of the recipient country probably produces lower altruism motives of the migrant workers to remit more money to their families. In vice-versa, the altruism motivates the migrant workers to remit more to their families to overcome the difficulty and necessity during the

The study shows income in these countries and workers’ remittance flows move at the same direction. Malaysia’s GDP per capita (LYH3) is positive but insignificant effects on the remittances inflow to the CLMV region. Possibly, the effect of this economy is too small influencing to the remittances. On the other hand, as an unexpected result of the Thai’s GDP per capita (LYH1) presents significantly negative effects on the remittances inflow to the CLMV countries. This result is seemingly consistent to Glytsos and Katseli (1986). Our empirical findings indicate that the migrant workers send more funds to their home country while the economy or income in Thailand is facing recession. The result is possibly due to the military coup and financial crisis awaking during the studied period. The recession encourages the migrants to remit more money to their home country to avoid losing from the turmoil. The military coup in Thailand is insignificant effect on the remittances inflows to the region, implying that the military coup does not affect the remittance directly but indirectly through the economic recession in the country. Within our studied period, few events happened and might impact on the remittance. Obviously, the global financial crisis and Middle East Respiratory Syndrome (MERS) coronavirus are resulted to be significant