Peter Ng'ang’aMusyimi, Daniel Mutuku2024-06-072024-06-072023-07https://ir-library.ku.ac.ke/handle/123456789/28309A Research Project Submitted to the Department of Applied Economics in Partial Fulfilment of the Requirements for the Award of Master of Economics (Cooperation and Human Development) Degree of Kenyatta University July, 2023The sole purpose of every government is to improve the welfare of its citizens. That is; to have high standards of living, quality education, good health and a quality general wellbeing. When a country thrives in human richness, then the country can be predicted to be on the rig!l( trajectory of achieving sustainable development goals. The Kenya scenario is no exception because the government has been striving to improve the welfare of its people. Though there has been increase in human development progress in Kenya from 0.468 human development index in 1990 to 0.575 human development index in 2021, the increase is relatively low compared to countries with very high and high levels of human development. Kenya is still in medium level which is far from the standards stipulated by UNDP which recommends countries to have high and very high human development index. Many of studies in Kenya have focused on remittances and education expenditure or remittances and health outcomes hence giving little attention on remittances and human development. This study sought to fill the gap between foreign remittances and human development in Kenya which has not received adequate attention despite the fact that foreign remittance has been one of the leading financial foreign inflows in the country. It is with this regard where the specific objectives sought to establish the effects of foreign remittances on both health index and education index. The study adopted foreign remittance as independent variable while health and education index were treated as dependent variables. To achieve the results, the study adopted vector error correction model (VECM) which falls under ordinary least square (OLS) regression technique. The model helped in determining the long run and short run effects of foreign remittances on health index and education index respectively. The study used time series data from period 1990 to 2021 and was obtained from secondary sources. A non-experimental research design was used to determine the frequency of association between the variables. Statistical results were achieved with the aid of statistical package E-views. The study concludes that foreign remittances have negative and significant effects on both health and education index. The study recommends that relevant authorities should deep in to understand the cause of negative relationship between remittances on both health and education index.enForeign RemittancesHuman DevelopmentKenyaThesis