1.
Amit Shukla
– Associate Professor, Department of Management Sciences, Indian Institute of Technology Kanpur (IIT Kanpur), Uttar Pradesh, India.
2.
Ishan Kumar Sarraf
– MBA Student, Department of Management Sciences, Indian Institute of Technology Kanpur (IIT Kanpur), Uttar Pradesh, India.
Abstract
Grounded in the New Economics of Labour Migration (NELM) framework and drawing on data from the Worldwide Governance Indicators (WGI) from the World Bank, this paper examines the impact of six governance attributes on remittance inflows to Nepal. The analysis suggests that political stability, along with accountability, has a positive association with remittance inflow, highlighting the importance of stable political conditions and accountable governance in building trust and economic resilience motivating individuals to remit funds. On the other hand, government effectiveness and regulatory quality demonstrate a negative association with remittance inflow, implying that inefficiencies in governance and regulatory obstacles may lead to increased labour migration and greater dependence on remittances. Interestingly, no significant relationship was observed between remittance inflows and control of corruption and rule of law, suggesting that these factors are possibly outweighed by economic drivers. The regression model accounts for a significant portion of the variation in remittance inflows and meets essential diagnostic criteria, ensuring the reliability of the results. These findings emphasise the importance of governance in affecting remittance trends and offer practical insights for policymakers.
Keywords World Governance Indicators, Remittance Inflow, Political Stability, Government Effectiveness, Regulatory Quality, Regression Analysis