Brain drain or brain gain? investigating the diaspora’s effect on the economy and real estate bubble: new evidence from Kenya based on ARDL analysis

The diaspora has often been castigated for the real estate bubble as a greater part of their remittances is invested in property. We therefore want to identify the relationship between these remittances, real estate prices and the GDP and employ the ARDL model to try and investigate whether there exists a long run relationship between them. This we believe would make a significant contribution to both the policy makers and academia due to scarce literature focused on the diaspora’s effect on the real estate prices in their home countries. We find no causal relationship between the remittances and the real estate bubble but find a trade-off in using the exchange rate to make housing more affordable at the expense of economic growth.