01807cas a2200253 a 4500 AALejournalIMF009056 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451865103 1018-5941 BD-DhAAL BD-DhAAL Caceres, Luis Rene. What Do Remittances Do? : Analyzing the Private Remittance Transmission Mechanism in El Salvador / Luis Rene Caceres, Nolvia Nery Saca. Washington, D.C. : International Monetary Fund, 2006. 1 online resource (30 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Family remittances are important for El Salvador's economy. This paper analyzes the impact of remittances on El Salvador's economy and the spillover effects on the other Central American countries. A vector autoregression (VAR) model is formulated, consisting of real and monetary variables. The results suggest that in, El Salvador, remittances lead to decreases in economic activity, international reserves, and money supply and increases in the interest rate, imports, and consumer prices. This underscores the need for reorienting economic policy in El Salvador to promote the use of remittances in capital formation activities to maximize the benefit of remittances. Mode of access: Internet Nery Saca, Nolvia. IMF Working Papers; Working Paper ; No. 2006/250 Full text available on IMF http://elibrary.imf.org/view/journals/001/2006/250/001.2006.issue-250-en.xml IMF e-Library