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Does migration raise agricultural investment? An empirical analysis for rural Mexico

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  • Marcus H. Böhme

Abstract

The effect of remittances on capital accumulation remains a contested topic. This article uses a panel data set from rural Mexico to investigate the impact of remittances on agriculture and livestock investments. After controlling for the endogeneity of migration through an instrumental variable estimation our empirical results show that international migration has a significantly positive effect on the accumulated agricultural assets but not on livestock capital. This suggests that households use the capital obtained from international migration only to overcome liquidity constraints for subsistence production whereas migration itself seems to be the superior investment option compared to other productive activities such as livestock husbandry.

Suggested Citation

  • Marcus H. Böhme, 2015. "Does migration raise agricultural investment? An empirical analysis for rural Mexico," Agricultural Economics, International Association of Agricultural Economists, vol. 46(2), pages 211-225, March.
  • Handle: RePEc:bla:agecon:v:46:y:2015:i:2:p:211-225
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    Cited by:

    1. Aiko Kikkawa & Keijiro Otsuka, 2016. "The Changing Landscape of International Migration : Evidence from Rural Households in Bangladesh, 2000-2014," GRIPS Discussion Papers 16-13, National Graduate Institute for Policy Studies.

    More about this item

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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