Migrants’ Remittances and Gross National Savings in Nigeria (1986-2016): An Empirical Study

Migrants’ remittances in Nigeria have increased substantially over the past four decades. It is expected that such massive inflows should be impacted positively on the country’s gross national savings in Nigeria. However, in spite of the growth of migrants’ remittances, the impacts of these inflows on gross national savings have not been adequately investigated by researchers in Nigeria. Consequently, this study investigated the impact of migrants’ remittances on gross national savings in Nigeria between 1986 and 2016. The data for the study were sourced from the Central Bank of Nigeria Statistical Bulletin and the African Development Indicators. The study employed the Fully Modified Ordinary Least Squares Method to estimate the impact. Results revealed that migrants’ remittance and gross domestic product in the country have a direct and significant relationship with the level of the gross national savings in Nigeria. It was further revealed that a percent increase in the level of remittance increased the gross national savings by 85 percent. However, inflation rate, age dependency ratio and exchange rate were not statistically significant in explaining the level of gross national savings in the study period. The study concluded that migrants’ remittance is robust enough to impact on national savings in Nigeria. The study therefore recommended that government should institute appropriate monetary, fiscal and trade policy measures that will effectively encourage the inflows of formal remittances into the country in order to raise the level of national saving. Keywords: Remittances, Savings, Inflation, Indicators, Dependency Ratio