Journal of Population Research

, Volume 30, Issue 2, pp 171–192 | Cite as

Labour migration and investments by remaining households in rural Nepal

Article

Abstract

Existing studies on the development effects of labour migration and remittances provide conflicting evidence and many suffer from self-selection bias. Furthermore, in spite of the significance of labour migration to the Nepalese economy, there are very few studies that formally analyse the development effect of labour migration in this region. Consequently, propensity score matching and a ‘difference-in-difference’ method is used to estimate the effect of labour migration and expectations to receive remittances from these migrants on investments by the remaining households in Chitwan, Nepal. The results suggest a positive role of labour migration and their likelihood of sending remittances on investments in agriculture, a type of productive investment.

Keywords

Remittance Labour migration Nepal Impact of migration Effect of remittances Migration Propensity score matching 

References

  1. Adams, R. (1998). Remittances, investment, and rural asset accumulation inPakistan. Economic Development and Cultural Change, 41(1), 155–173.CrossRefGoogle Scholar
  2. Airola, J. (2007). The use of remittance income in Mexico. The International Migration Review, 41(4), 850–859.CrossRefGoogle Scholar
  3. Bansak, C., & Chezum, B. (2009). How do remittances affect human capital formation of school-age boys and girls? American Economic Review, 99(2), 145–148.CrossRefGoogle Scholar
  4. Barber, J. S., Shivakoti, G. P., Axinn, W. G., & Gajurel, K. (1997). Sampling strategies for rural settings: A detailed example from the Chitwan Valley Family Study, Nepal. Nepal Population Journal, 6, 193–203.Google Scholar
  5. Bohra, P., & Massey, D. S. (2009). Processes of internal and international migration from Chitwan, Nepal. International Migration Review, 43(3), 621–651.CrossRefGoogle Scholar
  6. Bohra-Mishra, P., & Massey, D. S. (2011a). Individual decisions to migrate during civil conflict. Demography, 48(2), 401–424.CrossRefGoogle Scholar
  7. Bohra-Mishra, P., & Massey, D. S. (2011b). Environmental degradation and out-migration: New evidence from Nepal. In E. Piguet, A. Pécoud, & P. de Guchteneire (Eds.), Migration and climate change (pp. 74–101). UNESCO &Cambridge: Cambridge University Press.Google Scholar
  8. Caliendo, M., & Kopeinig, S. (2008). Some practical guidance for the implementation of propensity score matching. Journal of Economic Surveys, 22(1), 31–72.CrossRefGoogle Scholar
  9. De Haas, H. (2010). Migration and development: A theoretical perspective. International Migration Review, 44(1), 227–264.CrossRefGoogle Scholar
  10. Dehejia, R. H., & Wahba, S. (2002). Propensity score-matching methods for non experimental causal studies. Review of Economics and Statistics, 84(1), 151–161.CrossRefGoogle Scholar
  11. Durand, G., Parrado, E. A., & Massey, D. S. (1996). Migradollars and development: A reconsideration of the Mexican case. International Migration Review, 30(2), 423–444.CrossRefGoogle Scholar
  12. Ecer, S., & Tompkins, A. (2010).An econometric analysis of the remittance determinants among Ghanaians and Nigerians in the United States, United Kingdom, and Germany. International Migration.doi:10.1111/j.1468-2435.2010.00604.x.
  13. Esquivel, G., & Huerta-Pineda, A. (2007). Remittances and poverty in Mexico: A propensity score matching approach. Integration and Trade Journal, 27, 45–71.Google Scholar
  14. Filmer, D., & Pritchett, L. H. (2001). Estimating wealth effects without expenditure data—or tears: An application to educational enrollments in states of India. Demography, 38(1), 115–132.Google Scholar
  15. Gibson, J., McKenzie, D., & Stillman, S. (2009). The impacts of international migration on remaining household members: Omnibus results from a migration lottery program. Policy Research Working Paper 4956. Washington, DC: The World Bank Development Research Group.Google Scholar
  16. Government of Nepal. (2011). Nepal living standards surveyIII (NLSS-III). Press Release (8 August 2011): Main Findings. Kathmandu: National Planning Commission Secretariat, Central Bureau of Statistics.Google Scholar
  17. Hamilton, S., DeWalt, B. R., & Barkin, D. (2003). Household welfare in four rural Mexican communities: The economic and social dynamics of surviving national crises. Mexican Studies, 19(2), 433–462.CrossRefGoogle Scholar
  18. Heckman, J. J. & Todd, P.E. (2009). A note on adapting propensity score matching and selection models to choice based samples. IZA Discussion Paper No. 4304. Bonn: Institute for the Study of Labor (IZA).Google Scholar
  19. Heinrich, C., Maffioli, A., & Vázquez, G. (2010). A primer for applying propensity-score matching: Impact-evaluation guidelines. Inter-American Development Bank Technical Notes No. 161. Washington, DC: Inter-American Development Bank.Google Scholar
  20. Itzigsohn, J. (1995). Migrant remittances, labor markets, and household strategies: A comparative analysis of low-income household strategies in the Caribbean Basin. Social Forces, 74(2), 633–655.Google Scholar
  21. Koc, I., & Onan, I. (2004). International migrants’ remittances and welfare status of the left-behind families in Turkey. International Migration Review, 38(1), 78–112.CrossRefGoogle Scholar
  22. Lipton, M. (1980). Migration from the rural areas of poor countries: The impact on rural productivity and income distribution. World Development, 8(1), 1–24.CrossRefGoogle Scholar
  23. Lokshin, M., Bontch-Osmolovski, M., & Glinskaya, E. (2007).Work-related migration and poverty reduction in Nepal. World Bank Policy Research Working Paper Series 4231. Washington, DC: World Bank.Google Scholar
  24. Mora Rivera, J. J. (2005). The impact of migration and remittances on distribution and sources income: The Mexican rural case. Paper presented at the United Nations expert group meeting on international migration and development. Population Division, Department of Economic and Social Affairs, United Nations Secretariat, New York, 6–8 July 2005.Google Scholar
  25. Nepal Institute of Development Studies (NIDS). (2008). Nepal migration year book 2008. Kathmandu: Heidel Press.Google Scholar
  26. Oberai, A. S., & Singh, H. K. M. (1980). Migration, remittances and rural development. International Labour Review, 119(2), 229–241.Google Scholar
  27. Parnwell, M. (1993). Population movements and the third world. London: Routledge.Google Scholar
  28. Ratha, D., Mohapatra, S., & Silwal, A. (2010). The migration and remittances factbook 2011. Washington, DC: Migration and Remittances Unit, World Bank.Google Scholar
  29. Regmi, G., & Tisdell, C. (2002). Remitting behaviour of Nepalese rural-to-urban migrants: Implications for theory and policy. Journal of Development Studies, 38(3), 76–94.CrossRefGoogle Scholar
  30. Reichert, J. S. (1981). The migrant syndrome: Seasonal U.S. wage labor and rural development in central Mexico. Human Organization, 40, 56–66.Google Scholar
  31. Rempel, H., & Lobdell, R. A. (1978). The role of urban-to-rural remittances in rural development. Journal of Development Studies, 14(3), 324–341.CrossRefGoogle Scholar
  32. Rosenbaum, P. R., & Rubin, D. B. (1983). The central role of the propensity score in observational studies for causal effects. Biometrika, 70(1), 41–55.CrossRefGoogle Scholar
  33. Sahn, D. E., & Stifel, D. (2003). Exploring alternative measures of welfare in the absence of expenditure data. Review of Income and Wealth, 49(4), 463–489.CrossRefGoogle Scholar
  34. Smith, J., & Todd, P. (2005). Does matching overcome Lalonde’ scritique of non-experimental estimators? Journal of Econometrics, 125(1–2), 305–353.CrossRefGoogle Scholar
  35. Stark, O., & Bloom, D. E. (1985). The new economics of labor migration. The American Economic Review, 75(2), 173–178.Google Scholar
  36. Sumata, C. (2002). Migradollars and poverty alleviation strategy issues in Congo (DRC). Review of African Political Economy, 29(93/94), 619–628.CrossRefGoogle Scholar
  37. Taylor, E. J. (1992). Remittances and inequality reconsidered: Direct, indirect and interfemoral effects. Journal of Policy Modeling, 14(2), 187–208.CrossRefGoogle Scholar
  38. Taylor, E. J. (1999). The new economics of labour migration and the role of remittances in the migration process. International Migration, 37(1), 64–88.CrossRefGoogle Scholar
  39. Taylor, E. J., Arango, J., Hugo, G., Kouaouci, A., Massey, D. S., & Pellegrino, A. (1996). International migration and community development. Population Index, 62(3), 397–418.CrossRefGoogle Scholar
  40. Taylor, E. J., Rozelle, S., & de Brauw, A. (2003). Migration and incomes in source communities: A new economics of migration perspective from China. Economic Development and Cultural Change, 52(1), 75–101.CrossRefGoogle Scholar
  41. World Bank. (2005). Nepal development policy review: Restarting growth and poverty reduction. Report No. 29382-NP. Washington, DC: Poverty Reduction and Economic Management, South Asia Region.Google Scholar
  42. Yang, D. (2008). International migration, remittances, and household investment: Evidence from Philippine migrants’ exchange rate shocks. The Economic Journal, 118(528), 591–630.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2012

Authors and Affiliations

  1. 1.Office of Population ResearchPrinceton UniversityPrincetonUSA

Personalised recommendations