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Migration and Technological Change in Rural Households: Complements or Substitutes?

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  • Mariapia Mendola

    (University of Milan-Bicocca and Centro Studi Luca d’Agliano)

Abstract

In this paper we study the interrelationship between determinants of migration, conceived as a family strategy, and the potential impact of having a migrant household member on people left behind. Labour migration is often related to poverty but given its lumpy-investment nature, poverty may constitute a motivation to migrate as well as a constraint to do it. We use cross-sectional household data from two rural regions of Bangladesh to test whether migration is a form of income diversification strategy that significantly influences the risk-taking behaviour of source farm households in agricultural activities. We account for heterogeneity of migration constraints differentiating between domestic (temporary and permanent) and international moving destinations. We find that richer and large-holder households are more likely to participate in costly high-return migration (i.e. international migration) and employ modern technologies, thereby achieving higher productivity. Poorer households, on the other hand, are not able to overcome entry costs of moving abroad and fall back on migration with low entry costs, and low returns (i.e. domestic migration), which does not help them to achieve production enhancements and may lock them into persistent poverty. We interpret our results as evidence that if migration is a profitable household activity, entry constraints may hinder the access to it and its effectiveness as income diversification strategy.

Suggested Citation

  • Mariapia Mendola, 2004. "Migration and Technological Change in Rural Households: Complements or Substitutes?," Development Working Papers 195, Centro Studi Luca d'Agliano, University of Milano.
    • Handle: RePEc:csl:devewp:195
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    2. Marco Stampini & Benjamin Davis, 2009. "Does nonagricultural labor relax farmers’ credit constraints? Evidence from longitudinal data for Vietnam," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 177-188, March.
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    4. Mariapia MENDOLA, 2005. "Farm households production theories: a review of institutional and behavioural responses," Departmental Working Papers 2005-01, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    5. Benjamin Davis & Gero Carletto & Paul Winters, 2010. "Migration, Transfers and Economic Decision Making among Agricultural Households: an Introduction," Journal of Development Studies, Taylor & Francis Journals, vol. 46(1), pages 1-13.

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