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Investing back home: return migration and business ownership in Albania

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  • Kilic, Talip
  • Carletto, Calogero
  • Davis, Benjamin
  • Zezza, Alberto

Abstract

In view of its increasing importance, and the dearth of information on return migration and its impacts on source households, this study uses data from the 2005 Albania Living Standards Measurement Study survey and assesses the impact of past migration experience of Albanian households on non-farm business ownership through instrumental variables regression techniques. Moreover, considering the differences in earning potentials and opportunities for skill acquisition in different destination countries, the impact of household past migration experience is differentiated by main migrant destinations, namely Greece, and Italy. The study also tests for the hypothesis of the existence of migration cycles, by differentiating the time spent abroad based on the year of return. The empirical results indicate that household past migration experience exerts a positive impact on the probability of owning a non-farm business. While one additional year in Greece increases the probability of household business ownership by roughly 7 percent, a similar experience in Italy or further destinations raises the probability by over 30 percent. Although past migration experience for the period of 1990-2000 is positively associated with the likelihood of owning a household enterprise, a similar impact does not materialize for the period of 2001-2004. The latter finding seems suggestive of the fact that more recent migrants are yet to attain a target level of required savings and skills in order to successfully establish a new business upon return.

Suggested Citation

  • Kilic, Talip & Carletto, Calogero & Davis, Benjamin & Zezza, Alberto, 2007. "Investing back home: return migration and business ownership in Albania," ESA Working Papers 289043, Food and Agriculture Organization of the United Nations, Agricultural Development Economics Division (ESA).
    • Handle: RePEc:ags:faoaes:289043
    DOI: 10.22004/ag.econ.289043
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    2. Marjan Petreski & Nikica Mojsoska-Blazevski & Maja Ristovska & Edi Smokvarski, 2014. "Youth Self-Employment in Households Receiving Remittances in Macedonia," Working Papers PMMA 2014-08, PEP-PMMA.
    3. Marchetta, Francesca, 2012. "Return Migration and the Survival of Entrepreneurial Activities in Egypt," World Development, Elsevier, vol. 40(10), pages 1999-2013.
    4. Luis Miguel Tovar Cuevas & María Teresa Victoria Paredes, 2013. "Migración internacional de retorno y emprendimiento: revisión de la literatura," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 15(29), pages 41-65, July-Dece.
    5. Kathleen Beegle & Joachim De Weerdt & Stefan Dercon, 2011. "Migration and Economic Mobility in Tanzania: Evidence from a Tracking Survey," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 1010-1033, August.
    6. Amelie F. Constant, 2020. "Time-Space Dynamics of Return and Circular Migration: Theories and Evidence," CESifo Working Paper Series 8053, CESifo.
    7. Kalaj, Ermira Hoxha, 2009. "Do Remittances Alter Labor Market Participation? A Study of Albania," MPRA Paper 48271, University Library of Munich, Germany.
    8. Tiwari, Smriti, 2021. "Do macroeconomic fluctuations at destination matter in determining migrants’ return decisions?," World Development, Elsevier, vol. 148(C).
    9. Kalaj, Ermira Hoxha, 2010. "Remittances and Human Capital Investment: Evidence from Albania," MPRA Paper 49210, University Library of Munich, Germany.
    10. Ibrahim Sirkeci & Jeffrey H. Cohen & Dilip Ratha, 2012. "Migration and Remittances during the Global Financial Crisis and Beyond," World Bank Publications - Books, The World Bank Group, number 13092, December.
    11. Barbara Dietz, 2010. "Migration and Remittances in Macedonia : A Review," Working Papers 281, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    12. Yu Zhu & Zhongmin Wu & Meiyan Wang & Yang Du & Fang Cai, 2011. "Do Migrants Really Save More? Understanding the Impact of Remittances on Savings in Rural China," Journal of Development Studies, Taylor & Francis Journals, vol. 48(5), pages 654-672, June.
    13. Ambrosini, J. William & Mayr, Karin & Peri, Giovanni & Radu, Dragos, 2012. "The Selection of Migrants and Returnees in Romania: Evidence and Long-Run Implications," IZA Discussion Papers 6664, Institute of Labor Economics (IZA).
    14. Liu, Wan-Hsin, 2009. "Do sources of knowledge transfer matter? A firm-level analysis in the PRD, China," Kiel Working Papers 1578, Kiel Institute for the World Economy (IfW Kiel).
    15. Martinez, Candace & Cummings, Michael E. & Vaaler, Paul M., 2015. "Economic informality and the venture funding impact of migrant remittances to developing countries11Please contact Paul M. Vaaler regarding this paper. This research benefitted from a presentation at ," Journal of Business Venturing, Elsevier, vol. 30(4), pages 526-545.
    16. Wan-Hsin Liu, 2014. "Relevance of Own R&D and Sources of Knowledge Transfer for Industrial Innovation in China," The Developing Economies, Institute of Developing Economies, vol. 52(1), pages 1-25, March.
    17. Stelios Gialis, 2012. "Integration a few kilometres away from the motherland: Albanians' internal migration, settlement and voluntary return in Epirus and the Ionian Islands in Greece," Migration Letters, Migration Letters, vol. 9(2), pages 141-154, May.
    18. World Bank, 2010. "Albania - The New Growth Agenda : A Country Economic Memorandum," World Bank Publications - Reports 2935, The World Bank Group.
    19. Mendola, Mariapia & Carletto, Calogero, 2012. "Migration and gender differences in the home labour market: Evidence from Albania," Labour Economics, Elsevier, vol. 19(6), pages 870-880.
    20. Mezger Kveder, Cora Leonie & Flahaux, Marie-Laurence, 2013. "Returning to Dakar: A Mixed Methods Analysis of the Role of Migration Experience for Occupational Status," World Development, Elsevier, vol. 45(C), pages 223-238.
    21. Kalaj, Ermira, 2013. "Do remittances alter labour market participation?," SEER Journal for Labour and Social Affairs in Eastern Europe, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 16(4), pages 417-432.
    22. Mahe, Clotilde, 2017. "Occupational choice of return migrants: Is there a 'Jack-of-all-trades' effect?," MERIT Working Papers 2017-039, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    23. Luca Barbone & Andrew Dabalen, 2009. "Enhancing the development impact of migration," Bank i Kredyt, Narodowy Bank Polski, vol. 40(6), pages 59-76.
    24. Piracha, Matloob & Vadean, Florin, 2010. "Return Migration and Occupational Choice: Evidence from Albania," World Development, Elsevier, vol. 38(8), pages 1141-1155, August.
    25. Cris Beauchemin & Lama Kabbanji & Bruno Schoumaker, 2009. "Entre parcours de vie des migrants et attentes politiques, quel co-développement en Afrique subsaharienne," Working Papers 166, Institut National d'Études Démographiques (INED).

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    Keywords

    Food Security and Poverty;

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