In this paper we quantify the impact of wealth transfers such as remittances and foreign aid using a DSGE-RBC model. We calibrate and simulate the model using data from 85 recipient countries. Within this framework we demonstrate: First, the income eect created from a permanent increase in...

The primary objective of this article is to present a framework with which to analyze development and long-run growth in a small economy. The model that is constructed can be summarized as an open economy version of the Solow-Swan growth model, in which productivity growth is embodied within the...