The Effect of Emigration on Foreign Trade: The Case of Afghanistan (2001-2019)

Document Type : Research Paper

Authors

1 Department of Economics, Faculty of Administrative Sciences and Economics, University of Isfahan, Isfahan, Iran.

2 Department of Economics, Faculty of Administrative Sciences and Economics, University of Isfahan, Isfahan, Iran

10.22059/ier.2024.348499.1007535

Abstract

Immigration is one of the factors affecting macroeconomic variables, including foreign trade. Considering a large number of Afghan migrants throughout the world, this study sought to investigate the effect of Afghan migrants on the imports and exports of this country during 2001-2019, using the semiparametric augmented gravity model for the empirical purpose of the study. The results of semiparametric estimation of the fixed effects model have indicated that the role of emigration on the volume of exports and imports of Afghanistan has a non-parametric effect.That is, on some levels of emigration, the increase in the number of immigrants abroad has increased trade and confirms the existence of a complementary relationship between labor migration and trade, contrary to the theory of Heckscher-Ohlin, but at other levels, the accumulation of immigrants has caused a decrease in the volume of Afghanistan's imports and exports. This result is consistent with Heckscher-Ohlin 's theory, and of course it can be due to the integration of immigrants in the host society and the disconnection with the destination countries, the difference in skills level and information of immigrants.    

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Iranian Economic Review

Articles in Press, Accepted Manuscript
Available Online from 09 April 2024

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