EMIGRATION AND ECONOMIC GROWTH IN EUROPEAN TRANSITION ECONOMIES: EVIDENCE FROM A BOOTSTRAP PANEL CAUSALITY TEST IN ROLLING WINDOWS

Abstract

The relationship between migration and economic growth has long been a matter of discussion in theoretical and empirical domains. Previous studies which explored the link between variables suggested an estimation for an unchanging parameter. Despite that; prevailing economic and political circumstances, effective contracts and agreements, implemented policies, ongoing crises or shocks can cause a shift in the relationship across variables in due course. This study analyses the relationship between emigration and economic growth in transition economies in Europe for the period between 1995-2019 by administering time-varying causality test. Findings obtained from the bootstrap panel causality test suggest that there is a bidirectional causality relationship between emigration and economic growth only in Estonia but results of bootstrap panel rolling window causality analysis reveal that for the subperiods, there exist hidden causal relationships within Hungary, Lithuania, Poland, Slovakia and Slovenia.

Keywords

• Migration
• Economic growth
• Panel rolling window causality
• Transition economies

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