Panel data analysis on the impact of immigration on Economic Growth

Abstract

As the world is moving forward, immigration has also increased, which has a widespread effect. This paper focuses on the impact of immigration on economic growth; this is conducted through panel data analysis. The analysis is conducted in two parts, separated by high immigration countries and low-immigration countries. By carrying out fixed effect and random effect models in both low and high immigration countries, the results have shown a negative impact on GDP per capita if the inflow of foreign population increases. Panel GLS allowed us to see which model was appropriate for our specific model, where the result of panel GLS indicated a random effect model. The tests revealed that low immigration countries have a negative impact on remittances. Therefore, results suggest that there is an inverse relationship.