Navigating the Role of Remittances in Attaining Sustainable Development Goals in Developing Countries: New Insights from Panel ARDL Model

One of the foremost sustainable development goals is eradicating poverty by 2030. To attain this goal, remittances are crucial, especially for developing countries, in improving the well-being of the people. Therefore, this study examines the influence of remittances on poverty alleviation in developing countries. The data from eighteen developing countries was used from 2001 to 2020. For data analysis, panel unit root tests, Pedroni cointegration test, and panel ARDL model are used. The study found that foreign remittances are negatively and significantly related to poverty eradication. Similarly, GFCF, LFPR, trade, and human capital are negatively and significantly related to poverty in developing countries, while the variable inflation rate is positively and significantly related to poverty. Considering the study's outcomes, it is concluded that remittances are crucial in mitigating the poverty level in developing countries. Therefore, it is recommended that governments should provide migration-friendly measures, such as incentives for workers to travel overseas and remit funds legally rather than illegally. Low-income families would benefit from this, but it would also help the government to increase its foreign reserves.