Drinka Peković

Faculty of Finance, Banking and Audit, Alfa BK University,

Belgrade, Republic of Serbia

drinka.pekovic@alfa.edu.rs

ORCID 0000-0003-2777-8288

Impact of remittances on employment: Evidence from post-transition countries

Abstract. The aim of this paper is to examine the impact of remittances on employment rates in post-transition countries and to determine the differences in remittance effects on male and female employment rates. For this purpose, panel data over the 2008-2023 period are analysed for 24 countries. The remittance effects are estimated using the generalized method of moments (GMM) approach. The estimation results indicate that remittances have a statistically significant impact on the employment rate. In consideration of the endogenous regressor problem, it is estimated that a 10-percent increase in remittances per capita will result in a decline of 0.10 percent in the total employment rate. However, while the female employment rate is projected to fall by 0.18 percent, the effect on the male employment rate is insignificant. These research findings are pertinent to the determination of effective measures for mitigating the negative effects of remittances on the labour market.

Received: February, 2024

1st Revision: November, 2024

Accepted: March, 2025

DOI: 10.14254/2071-8330.2025/18-1/9

JEL Classification: F24, J21, C23

Keywords: remittance, employment rate, post-transition countries, labor market, GMM approach