Foreign Aid, Remittances and Poverty in Sub-Saharan Africa (2007-2018)
Foreign Aid, Remittances and Poverty in Sub-Saharan Africa (2007-2018)
*S. O. Falana, S. D. Salako, S. M. Akinsanya, L. O. Awoyinka, A. Salaudeen, and O. J. Adewoye
Department of Economics, Federal University of Agriculture, Abeokuta (FUNAAB), P.M.B. 2240, Abeokuta, Nigeria.
Department of Agricultural Economics and Farm Management, FUNAAB.
The Federal Polytechnic, Ilaro.
Department of Computer Science, Yaba College of Technology.
*Corresponding Author
Publication Information
Journal Title: International Journal of Research and Scientific Innovation (IJRSI)
Author(s):Falana, S. O. ;Salako,S. D. ;Akinsanya,S. M. ;Awoyinka, L. O. ;Salaudeen,A. ;Adewoye, O. J.
Published On: 03/07/2026
Volume: 11
Issue: 8
First Page: 698
Last Page: 725
ISSN: 2321-2705
- Cite this Article Falana, S. O. ;Salako,S. D. ;Akinsanya,S. M. ;Awoyinka, L. O. ;Salaudeen,A. ;Adewoye, O. J.: Foreign Aid, Remittances and Poverty in Sub-Saharan Africa (2007-2018), Volume 11 Issue 8, International Journal of Research and Scientific Innovation (IJRSI), 698-725, Published on 03/07/2026, Available at https://rsisinternational.org/journals/ijrsi/articles/foreign-aid-remittances-and-poverty-in-sub-saharan-africa-2007-2018/
Abstract
This study examined the impact of foreign aid and remittances on poverty in 37 sub-Saharan African countries from 2007 to 2018, a region that has received significant aid and remittances over the past 20 years. Key variables included Poverty Headcount (%), international remittances, and foreign aid flows. Data were obtained from the World Development Indicators, OECD, and the GCIP published by the United Nations. A dynamic panel data model was used, estimated with the system-Generalized Method of Moments (sys-GMM). The AR (2) and Hansen test statistics supported the model’s validity, and a robustness check with Real Household Final Consumption Expenditure confirmed the results. The findings indicate that remittances significantly reduce poverty in the short run but not in the long run, while foreign aid has an insignificant positive effect. The study recommends reducing remittance costs, removing barriers to inflow, and creating a policy environment that enhances the effectiveness of aid.
Keywords:
Poverty; Foreign Aid; Remittance.
