Abstract:

Abstract:This study examines the impact of remittance inflow on Nepal’s economy during the period of 2014/15 to 2021/22 using time series data and econometric techniques. The results reveal that remittance inflow has a positive and significant effect on the country’s economic growth, as well as on private consumption, investment, and government revenue. The study also found that the relationship between remittance inflow and economic growth is nonlinear and inverted U-shaped, implying that remittance inflow can boost economic growth up to a certain threshold, beyond which it can have adverse effects. Moreover, the study identifies some challenges associated with remittance inflow, such as its dependence on the global economic situation, its impact on income inequality, and the need for effective policies to utilize the remittance inflow for productive investments.