Seasonal Poverty and Internal Migration: A Research Agenda in Bangladesh and Nepal

About this event

A large literature, including the World Bank’s 2023 World Development Report, explores the interlinkages between international migration and economic development. But most human mobility in the world is within-country, not across international borders. The talk will outline a research agenda and open questions around the causes and consequences of internal, within-country migration, as well as the opportunities and impediments associated with such movements. Much of that movement in seasonal and circular, in response to seasonal deprivation during pre-harvest lean periods. We will then pivot to discussing the details of a research paper titled “Remittance Constraints and Seasonal Poverty.” Rural households send migrants to mitigate seasonal deprivation, but remittances don't always arrive in time. We observe a counter-intuitive pattern in Nepal where remittances are low when rural residents are food insecure, and migrants return with remittances later during harvest. To overcome this apparent remittance constraint indirectly, we provide a $90 loan to randomly-selected rural households during the pre-harvest lean season. Harvest period remittances increase in loan-recipient households, and 89% of the loan principal is repaid. Food security improves, and those households increase fertilizer use and own-farm labor. That increases their rice harvest, revenues, and subjective well-being. In a two-period model of household decision-making, we show that remittance frictions are necessary to qualitatively match our experimental results.