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Seasonal migration and micro-credit in the lean period : evidence from northwest Bangladesh

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  • Shonchoy, Abu S.

Abstract

This paper investigates the relationship between access to micro-credit and temporary seasonal migration, an issue which is largely ignored in the standard rural-urban migration literature. Seasonal migration due to agricultural downturns is a common phenomenon in developing countries. Using primary data from a cross-sectional household survey from the northwest part of Bangladesh, this study quantifies the factors that influence such migration decisions. Among other results, we find that network effects play a significant role in influencing the migration decision, with the presence of kinsmen at the place of destination having considerable impact. Seasonal migration is a natural choice for individual suffering periodic hardship; however the strict weekly loan repayment rules of Micro-credit Institutes can have an adverse effect on this process, reducing the ability of borrowers to react to a shock. Our result suggests that poor individuals prefer the option of not accessing the micro-credit and opt for temporal seasonal migration during the lean period. The results have numerous potential policy implications, including the design of typical micro-credit schemes.

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Bibliographic Info

Paper provided by Institute of Developing Economies, Japan External Trade Organization(JETRO) in its series IDE Discussion Papers with number 294.

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Date of creation: Mar 2011
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Publication status: Published in IDE Discussion Paper. No. 294. 2011.3
Handle: RePEc:jet:dpaper:dpaper294

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Related research

Keywords: Bangladesh; Microfinance; Population movement; Lean period; Seasonal migration; Micro-credit;

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References

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  13. Shahidur R. Khandker & M.A. Baqui Khalily & Hussain A. Samad, 2010. "Seasonal Migration to Mitigate Income Seasonality: Evidence from Bangladesh," Journal of Development Studies, Taylor & Francis Journals, vol. 48(8), pages 1063-1083, October.
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Citations

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Cited by:
  1. Shonchoy, Abu S. & Kurosaki, Takashi, 2014. "Impact of seasonality-adjusted flexible microcredit on repayment and food consumption : experimental evidence from rural Bangladesh," IDE Discussion Papers, Institute of Developing Economies, Japan External Trade Organization(JETRO) 460, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  2. Kurosaki, Takashi, 2012. "Urban Transportation Infrastructure and Poverty Reduction: Delhi Metro's Impact on the Cycle Rickshaw Rental Market," PRIMCED Discussion Paper Series, Institute of Economic Research, Hitotsubashi University 24, Institute of Economic Research, Hitotsubashi University.
  3. Michael Clemens and Timothy N. Ogden, 2014. "Migration as a Strategy for Household Finance: A Research Agenda on Remittances, Payments, and Development- Working Paper 354," Working Papers, Center for Global Development 354, Center for Global Development.

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