Remittances and Calorie Consumption Nexus in Algeria

Abstract This study investigates the cointegration and causal relationships between remittances and calorie consumption as an indicator of food security in Algeria. We estimate the calorie demand function for the period 1970‐2008, using two different cointegration tests Johansen and Juselius ( ) and autoregressive distributed lag (ARDL) bounds testing approach proposed by Pesaran et al . ( ) and Granger causality test based on Vector Error Correction Model. We find that: (1) GDP per capita affects calorie consumption positively and significantly; (2) income elasticity of calorie consumption is 0.16 in the short run and 0.60 in the long run; (3) remittances positively and significantly influence calorie consumption in the long run; (4) remittance elasticity of calorie consumption is 0.05 in the long run; (5) based on the causality test remittances influence calorie consumption directly and indirectly via GDP per capita in the long run.