IDEAS home Printed from https://ideas.repec.org/a/eee/wodepe/v19y2020ics2452292920300254.html
   My bibliography  Save this article

Migration, remittance, and agricultural productivity: Evidence from the Nepal Living Standard Survey

Author

Listed:
  • Kapri, Kul
  • Ghimire, Shankar

Abstract

This paper analyzes the relationship between migration, remittances, and agricultural productivity using microdata from Nepal. Instead of focusing on total agricultural yield, a common approach in the existing literature, our innovation is to examine the impact of remittances on household-level agricultural productivity, measured by output per labor-hour. Methodologically, we follow a three stage least squares (3-SLS) method in order to overcome potential endogeneity concerns. Overall results demonstrate that remittance-receiving households exhibit a higher level of productivity. More interestingly, quantile regressions show a bigger effect in households with lower productivity compared to their counterparts, suggesting remittance as a driver of agricultural productivity in Nepal. Additionally, we show that the impact can be different depending on the ecological belt. Given these salient observations, we draw important policy implications to improve agricultural productivity in Nepal and other similar developing countries.

Suggested Citation

  • Kapri, Kul & Ghimire, Shankar, 2020. "Migration, remittance, and agricultural productivity: Evidence from the Nepal Living Standard Survey," World Development Perspectives, Elsevier, vol. 19(C).
  • Handle: RePEc:eee:wodepe:v:19:y:2020:i:c:s2452292920300254
    DOI: 10.1016/j.wdp.2020.100198
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S2452292920300254
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.wdp.2020.100198?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. James R. Tybout, 2000. "Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 11-44, March.
    2. Gollin, Douglas, 2010. "Agricultural Productivity and Economic Growth," Handbook of Agricultural Economics, in: Robert Evenson & Prabhu Pingali (ed.), Handbook of Agricultural Economics, edition 1, volume 4, chapter 73, pages 3825-3866, Elsevier.
    3. Uttam Khanal & Khorshed Alam & Ramesh C. Khanal & Punya P. Regmi, 2015. "Implications of out-migration in rural agriculture: a case study of Manapang village, Tanahun, Nepal," Journal of Developing Areas, Tennessee State University, College of Business, vol. 49(1), pages 331-352, January-M.
    4. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 70(1), pages 65-94.
    5. Marrit Van Den Berg & Ruerd Ruben, 2006. "Small-Scale irrigation and income distribution in Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 42(5), pages 868-880.
    6. Nicholas Bloom & Aprajit Mahajan & David McKenzie & John Roberts, 2010. "Why Do Firms in Developing Countries Have Low Productivity?," American Economic Review, American Economic Association, vol. 100(2), pages 619-623, May.
    7. Vera Chiodi & Esteban Jaimovich & Gabriel Montes-Rojas, 2012. "Migration, Remittances and Capital Accumulation: Evidence from Rural Mexico," Journal of Development Studies, Taylor & Francis Journals, vol. 48(8), pages 1139-1155, February.
    8. Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Migration, Remittances, and Male and Female Employment Patterns," American Economic Review, American Economic Association, vol. 96(2), pages 222-226, May.
    9. Uwaoma G. Nwaogu & Michael J. Ryan, 2015. "FDI, Foreign Aid, Remittance and Economic Growth in Developing Countries," Review of Development Economics, Wiley Blackwell, vol. 19(1), pages 100-115, February.
    10. Lucas, Robert E B & Stark, Oded, 1985. "Motivations to Remit: Evidence from Botswana," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 901-918, October.
    11. Cao, Kang Hua & Birchenall, Javier A., 2013. "Agricultural productivity, structural change, and economic growth in post-reform China," Journal of Development Economics, Elsevier, vol. 104(C), pages 165-180.
    12. Shankar Ghimire & Kul Prasad Kapri, 2020. "Does the Source of Remittance Matter? Differentiated Effects of Earned and Unearned Remittances on Agricultural Productivity," Economies, MDPI, Open Access Journal, vol. 8(1), pages 1-15, January.
    13. repec:kqi:journl:2017-1-2 is not listed on IDEAS
    14. Agrawal, Arun & Gupta, Krishna, 2005. "Decentralization and Participation: The Governance of Common Pool Resources in Nepal's Terai," World Development, Elsevier, vol. 33(7), pages 1101-1114, July.
    15. Stark, Oded, 1982. "Research on rural-to-urban migration in LDCs: The confusion frontier and why we should pause to rethink afresh," World Development, Elsevier, vol. 10(1), pages 63-70, January.
    16. Alan De Brauw, 2010. "Seasonal Migration and Agricultural Production in Vietnam," Journal of Development Studies, Taylor & Francis Journals, vol. 46(1), pages 114-139.
    17. Wagle, Udaya R. & Devkota, Satis, 2018. "The impact of foreign remittances on poverty in Nepal: A panel study of household survey data, 1996–2011," World Development, Elsevier, vol. 110(C), pages 38-50.
    18. Shankar Ghimire & Taylor Rigatti & Nicholas Sexton, 2017. "Effect of Credit Cooperatives in Employment Generation: Evidence from Rural Nepal," Journal of Development Innovations, KarmaQuest Internatioinal, vol. 1(1), pages 29-44, February.
    19. Chandan Sapkota, 2013. "Remittances in Nepal: Boon or Bane?," Journal of Development Studies, Taylor & Francis Journals, vol. 49(10), pages 1316-1331, October.
    20. Atamanov, Aziz & Van den Berg, Marrit, 2012. "Heterogeneous Effects of International Migration and Remittances on Crop Income: Evidence from the Kyrgyz Republic," World Development, Elsevier, vol. 40(3), pages 620-630.
    21. Dambar Uprety and Kevin Sylwester, 2017. "The Effect of Remittances upon Skilled Emigration: An Empirical Study," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 42(2), pages 1-15, June.
    22. McArthur, John W. & McCord, Gordon C., 2017. "Fertilizing growth: Agricultural inputs and their effects in economic development," Journal of Development Economics, Elsevier, vol. 127(C), pages 133-152.
    23. Lucas, Robert E B, 1987. "Emigration to South Africa's Mines," American Economic Review, American Economic Association, vol. 77(3), pages 313-330, June.
    24. J. Edward Taylor & Scott Rozelle & Alan deBrauw, 1999. "Migration, Remittances, and Agricultural Productivity in China," American Economic Review, American Economic Association, vol. 89(2), pages 287-291, May.
    25. J. Taylor & T.J. Wyatt, 1996. "The shadow value of migrant remittances, income and inequality in a household‐farm economy," Journal of Development Studies, Taylor & Francis Journals, vol. 32(6), pages 899-912.
    26. Uttam Khanal, 2018. "Why are farmers keeping cultivatable lands fallow even though there is food scarcity in Nepal?," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 10(3), pages 603-614, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Khraiche, Maroula & Boudreau, James, 2020. "Can lower remittance costs improve human capital accumulation in Africa?," Journal of Policy Modeling, Elsevier, vol. 42(5), pages 1000-1021.
    2. Dhruba Bhandari, 2020. "Are Households Utilizing Remittance on Quality Education? An Empirical Study from Nepal," Journal of Development Innovations, KarmaQuest Internatioinal, vol. 4(1), pages 179-195, July.
    3. Jianxu Liu & Mengjiao Wang & Li Yang & Sanzidur Rahman & Songsak Sriboonchitta, 2020. "Agricultural Productivity Growth and Its Determinants in South and Southeast Asian Countries," Sustainability, MDPI, Open Access Journal, vol. 12(12), pages 1-21, June.
    4. Shankar Ghimire & Kul Prasad Kapri, 2020. "Does the Source of Remittance Matter? Differentiated Effects of Earned and Unearned Remittances on Agricultural Productivity," Economies, MDPI, Open Access Journal, vol. 8(1), pages 1-15, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Furqan Sikandar & Vasilii Erokhin & Hongshu Wang & Shafiqur Rehman & Anna Ivolga, 2021. "The Impact of Foreign Capital Inflows on Agriculture Development and Poverty Reduction: Panel Data Analysis for Developing Countries," Sustainability, MDPI, Open Access Journal, vol. 13(6), pages 1-22, March.
    2. Shankar Ghimire & Kul Prasad Kapri, 2020. "Does the Source of Remittance Matter? Differentiated Effects of Earned and Unearned Remittances on Agricultural Productivity," Economies, MDPI, Open Access Journal, vol. 8(1), pages 1-15, January.
    3. Atamanov, Aziz & Van den Berg, Marrit, 2012. "Heterogeneous Effects of International Migration and Remittances on Crop Income: Evidence from the Kyrgyz Republic," World Development, Elsevier, vol. 40(3), pages 620-630.
    4. B. Gabriela Mundaca, 2009. "Remittances, Financial Market Development, and Economic Growth: The Case of Latin America and the Caribbean," Review of Development Economics, Wiley Blackwell, vol. 13(2), pages 288-303, May.
    5. 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.
    6. Dhruba Bhandari, 2020. "Are Households Utilizing Remittance on Quality Education? An Empirical Study from Nepal," Journal of Development Innovations, KarmaQuest Internatioinal, vol. 4(1), pages 179-195, July.
    7. Lall, Somik V. & Selod, Harris & Shalizi, Zmarak, 2006. "Rural-urban migration in developing countries : a survey of theoretical predictions and empirical findings," Policy Research Working Paper Series 3915, The World Bank.
    8. I-Ling Shen & Frédéric Docquier & Hillel Rapoport, 2010. "Remittances and inequality: a dynamic migration model," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(2), pages 197-220, June.
    9. Woodruff, Christopher & Zenteno, Rene, 2007. "Migration networks and microenterprises in Mexico," Journal of Development Economics, Elsevier, vol. 82(2), pages 509-528, March.
    10. Sylvie Démurger & Shi Li, 2013. "Migration, Remittances, and Rural Employment Patterns: Evidence from China," Research in Labor Economics, in: Corrado Giulietti & Konstantinos Tatsiramos & Klaus F. Zimmermann (ed.), Labor Market Issues in China, volume 37, pages 31-63, Emerald Publishing Ltd.
    11. Juna Miluka & Gero Carletto & Benjamin Davis & Alberto Zezza, 2010. "The Vanishing Farms? The Impact of International Migration on Albanian Family Farming," Journal of Development Studies, Taylor & Francis Journals, vol. 46(1), pages 140-161.
    12. Kamalbek Karymshakov & Burulcha Sulaimanova, 2017. "Migration impact on left-behind women’s labour participation and time-use: Evidence from Kyrgyzstan," WIDER Working Paper Series 119, World Institute for Development Economic Research (UNU-WIDER).
    13. Taylor, J. Edward & Mora, Jorge & Adams, Richard H., Jr., 2005. "Remittances, Inequality and Poverty: Evidence from Rural Mexico," 2005 Annual meeting, July 24-27, Providence, RI 19245, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. Karamba, Wendy R. & Quiñones, Esteban J. & Winters, Paul, 2011. "Migration and food consumption patterns in Ghana," Food Policy, Elsevier, vol. 36(1), pages 41-53, February.
    15. Seidu, Ayuba & Onel, Gulcan, 2015. "International Migration, Remittance Income, and Income Diversification Strategies among Rural Farm Households in Transitional Albania," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205517, Agricultural and Applied Economics Association.
    16. Mendola, Mariapia, 2008. "Migration and technological change in rural households: Complements or substitutes?," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 150-175, February.
    17. Rapoport, Hillel & Docquier, Frederic, 2006. "The Economics of Migrants' Remittances," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 17, pages 1135-1198, Elsevier.
    18. Durga Prasad Gautam, 2017. "Remittance inflows and starting a business," Journal of Entrepreneurship and Public Policy, Emerald Group Publishing, vol. 6(3), pages 290-314, November.
    19. Kamalbek Karymshakov & Burulcha Sulaimanova, 2017. "Migration impact on left-behind women's labour participation and time-use: Evidence from Kyrgyzstan," WIDER Working Paper Series wp-2017-119, World Institute for Development Economic Research (UNU-WIDER).
    20. Sauer, J. & Gorton, M. & Davidova, S., 2014. "Migration and Agricultural Efficiency – Empirical Evidence for Kosovo," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 49, March.

    More about this item

    Keywords

    Migration; Remittance; Agricultural productivity; Nepal; Developing countries;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:wodepe:v:19:y:2020:i:c:s2452292920300254. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://www.journals.elsevier.com/world-development-perspectives .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Nithya Sathishkumar (email available below). General contact details of provider: https://www.journals.elsevier.com/world-development-perspectives .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.